African Skies Issue No. 51

Interview with Mr. Abdérahmane Berthé

The key focus and achievements of the Association under the Secretary General’s leadership.

53rd AGA sets roadmap

Air transport leaders and decision makers set a roadmap for transformation and the economic development of air transport in Africa.

The burning questions

Understanding the essential elements of aircraft finance and how to pivot towards success given the current environment.

AFRAA to lead an all-inclusive laboratory

Out-of-the-box solutions to effectively implement the SAATM and AfCFTA and to address the sustainability of air transport in Africa.

AFRAA diary 2021 at a glance.

Coming in May 2022!

Let’s meet ‘in-person’ at AFRAA’s exciting 10th Aviation Stakeholders Convention at the Emara Ole Sereni Hotel from 8-10 May 2022

The event is being hosted in collaboration with Kenya Airways

The Convention will build on the momentum to rebuild a more resilient and sustainable travel ecosystem in Africa. It is critical that all stakeholders put their weight behind the aviation sector in order for us to create the much needed enabling environment for air transport business to thrive and contribute to the continent’s sustainable rapid development.

Why attend?

• Gain valuable insights from industry leaders on how to enhance business in the evolving market.

• Discover how to leverage on new technology the smart and cost-effective way.

• Deliver customers centric service, increase operational efficiency and reduce cost through smart strategies.

• Learn how to restructure your business to take advantage of emerging opportunities.

• Find out where the business opportunities are, which routes to operate and how your network can be coordinated to yield the best results.

• Sustain business growth by exploiting financing opportunities for aircraft, technology and other equipment.

• Deepen partnerships with airlines and industry suppliers.

• High value networking, one-to-one business discussion and exhibitions all in one place.

• Build relationships with airlines and suppliers.

• Benefit from in-depth knowledge in a specific area through the Master Class sessions. Marketing opportunities through sponsorship and exhibition

The Convention provides excellent brand visibility and marketing opportunity through sponsorship and exhibition. For more information on the option available, please contact: Ms. Maureen Kahonge, Email: mkahonge@afraa.org, Tel: +254 725 500470

Registration

For registration and information about the event, please visit the website: http://asc.afraa.org/

Looking ahead into 2022 and beyond

2021 has been a yet another challenging year for the air transport industry. In as much as the industry is not yet out of the woods, some positive trends into recovery have been remarked in 2021. As at October 2021, African airlines had reopened 81.3% of their international routes that has been closed due to the pandemic. African cargo capacity grew by 33% since 2019 and cargo load factors improved by 9% from pre-pandemic levels.

The dawn of recovery is critical time to redefine strategic plans for the next five years. To support the recovery, decision makers AFRAA’s 53 Assembly set a roadmap for transformation and the economic development of air transport in Africa. The Assembly took three main resolutions that will advance the cause of African aviation. Firstly, the assembly took a resolution on safe reopening of borders. Recognising that safe reopening of borders in a harmonised manner is critical for the efficient restart of African aviation, the Assembly urged African governments to remove border restrictions and open their markets to restart the industry with support from Industry Restart Plan Standards and guidance documentation. The Assembly further called upon African governments to accelerate the rapid roll out of vaccines across the continent and embrace the use of digital technology health platforms to facilitate the restart of economies and air transport.

Secondly, the Assembly took a resolution on financial support to African airlines. Recognising the importance of financial support for the recovery of the air transport industry, the Assembly called upon African governments to extend the much-needed financial support and relief to African airlines and the African aviation industry at large.

Thirdly, the Assembly took a resolution on Laboratory concept approach for attainment of sustainability of African airlines. Recognising the importance of addressing the sustainability and competitiveness of Africa’s air transport, the Assembly called for a laboratory convening all relevant stakeholders as a transformation opportunity for the economic development of air transport in Africa. AFRAA Secretariat in coordination with the African Union Commission (AUC), the African Civil Aviation Commission (AFCAC), and the African Aviation Industry Group (AAIG) shall convene the LAB by the end of March 2022.

2021 has been a perfect occasion to address the future of African aviation and enhance our commitment to develop a resilient and sustainable perspective for the airline industry. AFRAA will keep by our mission to promote and serve African airlines and champion Africa’s aviation industry –Better Skies for Africa – remains the pillar of all our actions.

Mr. Abdérahmane Berthé AFRAA Secretary General

AFRAA will keep by our mission to promote and serve African airlines and champion Africa’s aviation industry –Better Skies for Africa.

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Enhancing passenger airports experience

Working on contactless technology to improve safety and efficiency at the airports.

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53rd AGA sets roadmap

Air transport leaders and decision makers set a roadmap for transformation and the economic development of air transport in Africa.

FEATURES

04

Interview with Mr. Abdérahmane Berthé

The key focus and achievements of the Association under the Secretary General’s leadership.

24

Drivers of the aviation industry growth

In terms of aviation industry competitiveness over time, African continent is still not performing as per the average expectation.

08

The burning questions

Understanding the essential elements of aircraft finance and how to pivot towards success given the current environment.

28

AFRAA to lead an all-inclusive laboratory

Out-of-the-box solutions to effectively implement the SAATM and AfCFTA and to address the sustainability of air transport in Africa.

REGULARS | RÉGULIERS

01

Message from AFRAA’s Secretary General

30

AFRAA diary

2021 at a glance.

44 AFRAA data

Where are we coming from.

https://www.linkedin.com/company/african-airlines-association/

@AFRAA.AfricanAirlinesAssociation

@AfricanAirlines www.afraa.org

All rights reserved. No part of this magazine may be reproduced by any means without permission in writing from AFRAA. While every care is taken to ensure accuracy in preparing African-skies, the publishers and AFRAA take no responsibility for any errors or omissions contained in this publication.

ican skies

African-skies

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Printed in Nairobi, Kenya

Interview with Mr. Abdérahmane Berthé, Secretary General, AFRAA

Interview also featured in the Aviation & Allied Business Journal, December-January edition

1. Over the past four years, as AFRAA SecretaryGeneral, what has been the key focus and achievements of the Association under your leadership?

AFRAA was created 53 years ago. I took the office of AFRAA Secretary-General in January 2018. The secretariat’s mandate is to add value for AFRAA member airlines and partners. For four (4) years, under my leadership, there have been some changes to position AFRAA as the voice of African airlines achieved through concerted efforts that have seen AFRAA become the leading trade association of airlines in Africa.

I would like to see AFRAA leading the airline industry in Africa to attain a sustainable, interconnected, and affordable air transport industry where African airlines become key players and drivers to African economic development.

We are supporting the African Aviation industry in four main areas:

• Lobbying and advocacy to create a conducive environment;

• Joint projects beneficial to members;

• Data warehouse and studies;

• Consultancy services.

2. AFRAA has engaged in efforts to drive the industry and particularly airline recovery from the COVID-19, how would you assess the level of recovery achieved so far by African airlines?

The adverse influence of the COVID-19 is being felt entirely by the African continent. The aviation industry is amongst the worst impacted. On 17 March 2020, AFRAA appealed to all African governments, regulatory authorities, and stakeholders to come together and support our African airlines.

AFRAA held a webinar on Monday, 20 April 2020, which paved the ground for AFRAA 9-pillar recovery plan developed by the secretariat for the African airline industry. The recovery plan outlines a framework of actions to be taken as part of urgent, immediate, and consistent actions for the survival and recovery of the industry.

AFRAA estimates the revenue loss by African airlines in 2020 at USD 10.21 billion. We see some improvement. However, we estimate the revenue loss for 2021 at USD 8.5 billion, 49% of 2019 revenues. We are not expecting a full recovery before 2023, beginning 2024.

“I would like to see AFRAA leading the airline industry in Africa to attain a sustainable, interconnected, and affordable air transport industry where African airlines become key players and drivers to African economic development.”

3. What is AFRAA doing about the challenge of government travel restrictions that hinder African airline industry recovery?

Lifting of travel restrictions in a harmonised manner and opening of markets is critical for the restart and the recovery of the travel industry. AFRAA urges African governments to remove border restrictions to support the Industry restart.

AFRAA 53th Assembly adopted a resolution for a safe reopening of borders. According to ICAO CART guidelines, the assembly called upon African governments to harmonise pre-entry and exit requirements to increase mutual recognition and cross-border information exchange. The assembly also called upon African governments to accelerate the rapid rollout of vaccines across the continent to facilitate the restart of economies and air transport.

4. Would you say that African governments and Multilateral Financial Institutions have done well in supporting African airlines during this pandemic?

Whereas governments worldwide have provided over USD 400 billion to national and private airlines to support their survival and restart efforts, given the importance of aviation to economies, we have seen very little support to African airlines from African governments and Multilateral Financial Institutions.

In May 2020, AFRAA and other aviation organisations appealed to Multilateral Financial Institutions to support the travel industry. In July 2021, further appeals were made to the Development Finance Institutions to support African airlines.

Some support has been extended by governments and Multilateral Financial Institutions (DFIs) to support the aviation sector, although this is very limited and primarily to State-owned entities. Eight (8) African airlines have either gone into administration or bankruptcy due to the impacts of the pandemic.

Financial relief is critical for the recovery of the air transport industry and the survival of African airlines in a deteriorated financial status.

AFRAA 53rd Assembly adopted a resolution for financial support to African airlines.

The assembly called upon African governments to extend the much-needed financial support and reliefs to African airlines and the African aviation industry at large, in the form of loans, direct cash injections, guarantees, taxation waivers and deferrals, wage subsidies, and reduction in Airport, ANSP, and Fuel charges to facilitate faster and sustainable recovery.

The assembly also called upon Development Finance Institutions to make a clear commitment to the financial support they want to give African airlines, publicise the criteria and types of facilities available, and expedite the disbursement to save the industry from collapse.

5. How would you assess the Single African Air Transport Market (SAATM) and the African Continental Free Trade Area (AfCFTA), since many African States are yet to embrace these frameworks, and Africa is still replete with very high taxes, charges, and fees on aviation?

Faced with the slowness in implementing the Yamoussoukro decision of 1999, African states launched the SAATM (Single African Air Transport Market) under the aegis of the African Union.

To date, 35 states out of 55 have signed the SAATM, and 18 states have signed the Memorandum of Implementation committing to bring their air services agreements in line with the Yamoussoukro decision. The implementation of the SAATM is based on a comprehensive plan involving all stakeholders in the aviation sector in Africa.

The implementation is laborious. However, we have seen a lot of progress. In other parts of the world, we have seen the same phenomenon. Liberalisation does not happen overnight. It is a long-term and irreversible process because everyone recognises the expected benefits.

Some states are willing to protect their national carriers by delaying the implementation of liberalisation. This stand does not guarantee sustainability for air transport in these countries.

We need to start by ensuring implementation by the 35 signatory states. The other states will follow sooner or later. A Joint Prioritised Action Plan with set KPIs amongst the concerned stakeholders; reviewed annually to track progress. The air transport liberalisation in the continent through the YD will create a more regionally integrated continent.

The African Continental Free Trade Area (AfCFTA), launched in March 2018, complements SAATM. It aims to significantly accelerate the growth of Intra-Africa trade and use trade more effectively as an engine of growth and sustainable development by doubling intra-Africa trade, strengthening Africa’s common voice and policy space in global trade negotiations. As part of the SAATM joint prioritised action plan (JPAP), the industry stakeholders are tackling the challenges hindering the sustainability of air transport.

AFRAA will convene in the 1st quarter of 2022 a laboratory with all relevant stakeholders as a transformation opportunity for the economic development of air transport in Africa and the innovation of short-term survival and medium-term sustainability.

6. Are there specific instances of African airlines being denied market access into the African States since the SAATM and AfCFTA came into effect? What has been the experience of your members in this regard?

The African Union commissioned a continental study on SAATM implementation in 2021.

The study revealed that only 39% of the Bilateral Air Service Agreements (BASAs) reviewed were compliant with the Yamoussoukro Decision (YD); meaning 61% were non-compliant and did not follow the provisions of the YD (namely on unrestricted 3rd/4th, and 5th freedom traffic rights, free determination of capacity and free pricing tariff regime).

Of the non-YD compliant BASAs, 28% failed to meet just one of the pre-requisites for YD Compliance, while the remaining 72% failed because of non-compliance on two or more pre-requisites; 18% are fully restrictive across all the provisions of the YD.

88% of non-compliant BASAs are restrictive in terms of 3rd, 4th, or 5th traffic rights, with 82% being restrictive in terms of 3rd and 4th traffic rights

50% of the BASAs restricting 3rd and 4th traffic rights are restrictive because they limit the number of entry points (airports) for designated carriers.

These continental study outcomes give a good picture of the experience of our members in this regard of market access.

7. What were the highpoints of the recently-concluded 2021 AFRAA AGA in Luanda, Angola, and how have AFRAA member airlines benefitted from AFRAA’s partnership programmes on fuel, handling, route coordination, among others?

The 53rd Annual General Assembly held in virtual format on 16-17 November 2021 and hosted by TAAG Angola Airlines was successful.

In addition to other statutory matters of the Association, the assembly adopted three (3) critical resolutions on the safe reopening of borders, financial relief to aviation, air transport ecosystem sustainability.

The theme of the AGA was “Flightpath to Africa’s Resilient Travel Ecosystem.”

It was a good occasion for experts to exchange views on enhancing the African air travel industry’s resilience to crisis.

The COVID-19 pandemic is an unprecedented crisis in the aviation industry. During the crisis period, the AFRAA secretariat developed a portfolio of new projects. AFRAA projects aim to facilitate beneficial cooperation among African airlines to implement cost-effective standard solutions on various aspects of airline operations. The new projects complement the existing fuel, training, route network, and cargo programs. The newly established AFRAA joint projects for members cover capacity sharing, maintenance, spare parts, operations control and management, training, connectivity, distribution.

8. Do you think big carriers could still emerge among African airlines as a response to the severe passenger, revenue and other losses suffered by most if not all carriers?

The diversity of carriers in the African market has been a concern well before the COVID-19. We acknowledge the need to have as many airlines as necessary to connect the 55 countries on the continent.

Despite the high growth potential, the African market represents less than 3% of the global market. Hence some consolidations have to happen.

In September 2021, in partnership with Kenya Airways and Lufthansa Consulting, AFRAA organised a workshop on African airlines consolidation. The workshop made recommendations which we are following with implementation actions.

The continent will need 6 or 7 global carriers with a global network to connect the continent to the other regions. Some regional carriers are also required to interconnect African countries and feed and de-feed traffic to/from the main hubs. Enhancement of cooperation among African airlines in areas such as alliances, pooling of resources, code sharing, and interlining are valid considerations for African airlines to succeed.

9. There appear to be increased partnerships between foreign airlines and African airlines, what could be the implications of this regarding the air transport liberalisation in Africa and the interest of African carriers?

The Yamoussoukro Decision (YD) liberalises the air transport in Africa for African Carriers. The intent is not to open the intra-African market to foreign airlines. African airlines, by the time, have lost market shares on inter-continental routes falling to less than 20% currently. This situation needs to be addressed.

In principle, partnerships between airlines are good as long as they comply with existing regulations and benefit parties. AFRAA encourages these kinds of partnerships

10. As the industry strives towards recovery, how would you describe the airports-airlines relationship in Africa, and what is your expectation going forward?

Both airports and airlines are part of the aviation industry. Our activated and all have faced the same impact of COVID-19.

Airports and airlines have been part of the aviation stakeholders’ efforts to overcome the consequences of the pandemic. The International Civil Aviation Organization (ICAO), through the Council Aviation Recovery Task Force (CART), has made recommendations to the aviation industry to address the challenges of COVID-19 and provide global

guidance for a safe, secure and sustainable restart and recovery of the aviation sector.

To strengthen our relations, AFRAA has signed in 2021 a Memorandum of Understanding (MoU) with ACI-Africa (Airports Council International). The two organisations will work on a joint annual action plan.

11. Boeing’s 20-year aviation market forecast indicates that Africa would require 1,030 aircraft valued at nearly USD 400 billion; how can Africa double or triple its share of the global passenger and cargo markets over the next 20 years?

Despite representing 15% of the global population, Africa accounted for only 3% of global air traffic in 2018.

Air traffic growth in Africa has been upward since 2011, with passenger services being the key contributor.

Fueled by a young, vibrant, rapidly urbanizing population, Africa is the fastest-growing continent, making it an attractive prospect for foreign investors.

Despite the COVID-19, we still think that the traffic will double within the next 20 years. The operationalisation of the AUC flagship project (SAATM, AfCFTA, and free movement Protocol) shall further spur this traffic growth.

12. Where do you see AFRAA and the African airline industry in the next 10 years?

The world aviation industry is fast-moving which new customers’ expectations. Our industry needs to adapt to new transformative initiatives.

At AFRAA, we have redefined our strategic objectives, which are:

• Safe, secure, and reliable air transport;

• Enhance the visibility, reputation, and influence of African airlines in the global Aviation industry;

• Sustainable air transport;

• Cooperation;

• Data intelligence.

We have launched a new 5-year strategic plan in 2021. The purpose is to implement practical actions better to serve our members’ and partners’ needs.

Albeit the challenges, Africa has a vast potential for development for years ahead. The traffic is said to double every 15 to 20 years. AFRAA airlines need to be prepared to take their market share from this development perspective. As we expect more and more passengers for years ahead, the industry needs to tackle the challenges related to its future expansion: safety, security, environment, infrastructure on ground and air, regulation, capacity building, market access, and operational costs, among others.

Digitalisation is transforming the customer’s experience at all stages of their journey. New technologies will also play a critical role in aircraft designs and operations.

I look for an African air transport where African airlines increase their market share and are more sustainable and where ticket fares are affordable for average African citizens.

The burning questions on aircraft financing in Africa

What are current headwinds facing African Airlines?

Edwards: There are a number of hurdles to be met when financing aviation assets in this geography. Anecdotally, through interactions with airlines across Sub-Saharan Africa, the following challenges are apparent: recovering from ravages of the COVID-19 pandemic, finance costs, finance availability and appetite for ownership considerations. Certainly, there are positives in the region including the Single African Air Transport Market (SAATM) asserting its open skies mandate, Cape Town Convention status enabling easier repossession and importantly funding at a lower cost and global liquidity which all play an important role. Yet these factors only bear consideration once the bigger hurdles mentioned above have been crossed.

Notably, despite near-term headwinds, there are good opportunities as Africa reflects the fastest growing working age population. Also, a burgeoning freight market should create greater opportunities across the continent. Boeing estimates that by 2029, more than 1,000 aircraft will be needed in Africa, most of which will constitute growth as opposed to replacement of an aging fleet.

In this Q&A with AFRAA, Boeing Capital Corporation Executives Vasgen Edwards, Managing Director; Lereece Rose, Senior Finance Director; and Sam Muhumuza, Account Manager, discuss aviation finance in Africa.

Boeing’s forecast of aircraft replacement in Africa

Source: Boeing

Understanding the essential elements of aircraft finance and how to pivot towards success given the current environment

Africa’s working age population growth

How can industry navigate toward profitability post pandemic?

Rose: As the industry emerges from the pandemic, it will adapt to new models that underpin the existing financial market frameworks. At this inflection point, new opportunities will be presented to those that are prepared and can capture pent up demand.

Return to growth pathways will require changes in approach as plans for new cap-ex are solidified. What we potentially see is an environment with closer co-operation within the existing financial ecosystem that will be augmented by an extension to new sources of financing.

The good news is that a number of financing options are available to airline operators and financiers as they explore and develop post-pandemic strategies. The full breadth of financing pathways, including lease solutions, alongside various Export Credit Agency (ECA) options, will certainly continue to play a role and discussions at the outset of any financial planning assessment should capture all the financial products that are suitable. Boeing Capital Corporation (BCC) continually works with Boeing customers and industry financiers to help determine the best solution for their particular situation. This on-going transaction support has proven instrumental in offering customers and financiers a better understanding

Source: Boeing

Source: Boeing

Boeing capital delivery funding in Africa

What are some practical steps that can help ensure a successful financing outcome?

Muhumuza: Prior to the airline going to market, a clearly formulated strategy set out in the form a business plan will help maximise a successful outcome with stakeholders. Utilizing support from Original Equipment Manufacturers (OEMs), airlines should consider the following:

What are expectations around increased finance costs relative to perceived and real risks?

Edwards: Increased risk in Africa is a reality for most financiers because their models take into account a number of factors including but not limited to:

• Defaults at both country and airline level;

• Difficulty in repatriation of funds;

• Economies that are largely dependent on a single resource to drive revenue and growth (e.g. oil production);

• Revenue and income currency mismatches;

• The overall stability of the business, country and region.

While determining the above risks is somewhat beyond the control of an airline, perceived risk can be managed to a greater degree with thorough preparation and providing comprehensive information to financiers. BCC is in a position to facilitate understanding of the market and the risk and reward framework that underpins aircraft financing. For many years, our outreach programmes have facilitated the on-boarding of numerous financial institutions into the aviation financing community through regular market updates on a global basis. BCC has also invested to ensure our teams are present in the Middle East and Africa region to best understand local market conditions and developments. That connectivity is integral to building the right solutions for our customers.

Boeing Capital preparation phase / go to market / optimise solution

Source: Boeing

Is finance availability directly correlated to the visibility of a particular airline or country? What about the role of local financiers?

Rose: There is much to be said for airlines who maintain interaction with local and international banks to leverage the best of both worlds. We have seen first-hand the value of on-boarding local institutions to fund solutions often in conjunction with international banking groups. It is well noted that longer term financing in US dollars can exert additional stress on local and regional banks. However, there is unquestionably a part-to-played by these financial institutions in the shorter tenor tranches of aircraft financing, notably PDPs and mezzanine facilities. Second, when international banks are able to fund in local currencies, due to a long established presence in a particular jurisdiction and an accumulation of revenue denominated in local currency, it provides availability that stimulates competition and bodes well for the price of financing in the local market.

What are your thoughts on a pan continental leasing platform?

Muhumuza: Lessors are very important to aircraft finance and the number of aircraft under lease has grown exponentially since 1980. While the vision of a body that is wholly dedicated to the financing of aircraft on the African continent merits further investment and discussion, there are many capable players in the aviation financing market today. The industry should continue to use existing solutions while exploring new options that could accelerate growth of the aviation market. BCC certainly sees the benefit of multiple institutions, coordinating their combined capabilities to bring capital and solutions to airlines that are the lifeblood of the African continent. The main benefit of such a leasing platform would be to counter the effects of dollar denominated payments, especially in those airlines that generate revenue in local currencies which can be prone to fluctuation against the U.S. dollar.

Also, a leasing platform in which participant financiers span across banks, multilaterals, OEM’s and lessors enhances the diversity of the financing product. This can create interest for greater participation by financiers who would not normally consider financing in these jurisdictions.

Boeing capital current aircraft finance market outlook lessor analysis

Source: Boeing

Boeing in Africa

Boeing’s heritage in Africa dates back nearly 75 years. Since the introduction of the jet airplane, Boeing planes have formed the backbone of the continent’s commercial fleet. With more than 60 airline customers operating about 460 Boeing airplanes throughout Africa, Boeing represents nearly 70% of the airplane market currently in service across the continent. Currently, Boeing has offices in Johannesburg, South Africa, and Nairobi, Kenya, in addition to field service representatives with commercial customers across the continent. Boeing Capital Corporation is a global provider of financing solutions for Boeing customers.

What about cargo operations?

Edwards: The freighter market remains a bright spot during the pandemic. Yields have remained very high, and more freighters are flying than before the pandemic due to limited belly cargo capacity from passengear airplanes.

From a regional perspective, according to IATA, Africa cargo demand is growing and as of the first quarter of 2021, cargo operations are at 120% of normal volumes as consumers move toward e-commerce purchases and vaccinations are transported globally.

Stepping back, both financiers and investors have recognised the strength seen in the cargo market throughout the pandemic. In fact, freighters are the best performing aircraft class in terms of values during the pandemic, as the world realises the importance of air cargo.

Revenue Tonne Kilometres have reflected a dramatic increase since the lean years prior to the pandemic and yields opportunities for all airlines but especially for the African airlines with its increasing exports and abundant resources much needed by an array of industrial sectors.

Any closing thoughts?

Author: Boeing Capital Corporation

Rose: Overall, aviation is a growth business, with annual growth expected to be about 4% over the next 20 years. There is absolutely no question that the African aviation industry will continue to flourish and successfully adapt to a post pandemic marketplace. Aviation is an important driver of the economy and airlines are planning now for recovery and that includes working with financiers on creative solutions. Governments will also play an important role as they develop policies to best serve their respective economies and citizens. We expect that capital will continue to be routed into the sector by established players and as new entrants seek opportunities during the industry’s recovery.

Source: Boeing

Enhancing passenger airports experience using biometrics for a contactless journey

As the Air Transport industry continues to struggle due to the impact of the COVID-19, Collins Aerospace is working on contactless technology to improve safety and efficiency at the airports.

“Technology is playing a significant role in the recovery and biometrics is going to be the key enabler by providing a contactless journey through the airport,” explains Rakan Khaled, the Director of Global Business Operation at Collins Aerospace. “The good news is that biometrics had a business case before COVID-19 to improve the passenger experience using

facial recognition with a single-token journey and getting the passenger from curb-to-gate. Now we have the added benefit of minimising contact to reduce the transmission of the virus,” he added.

Collins looked at every touch point at the airport for passengers and considered how to convert them into contactless solutions. Starting with the existing Collins ARINCTM SelfPass biometric solution, which enables a passenger to register his/her biometrics and link to their boarding pass. This allows a more contactless – and seamless – travel experience for

the passenger. By integrating the full process with the airline, a traveller can pass through self-service kiosks, or the bag drop unit or a biometric-enabled security gate to go through the entire process, minimising touch points to reduce congestion and improve flow.

Global aviation associations including ICAO, IATA, and ACI have recently acknowledged support for the recommendation of using biometrics and Collins predicts that it is going to be the number one building block for developing solutions to boost passenger confidence along the journey.

Additional technologies will incorporate

biometrics with mobile device technologies to avoid contact with devices for payment as well as potentially using artificial intelligence to map out congestion points within an airport and alerting systems. AI will also likely play a role in maximising airport systems and leveraging data trends to improve efficiencies. This helps enable social distance, reduce anxiety and improve the passenger experience, avoiding bottlenecks around the airport throughout the entire process. Biometrics, while not a new technology, has seen more interest in the past few years at airports across the globe and particularly in Africa, where Collins has been engaged in discussions with several airports. “We’re actually implementing self bag drop solutions in a couple of airports in Africa at the moment, and we’re having more and more interest every day” shared Rakan Khaled. “This offers an airport resilience and flexibility in how passengers are using the airport, distributing demand while also harnessing increasingly familiar technologies.”

The key factor to developing contactless technology in Africa is scalability to meet demand. Collins expects the contactless solution to emerge and grow because it improves the passenger experience in many different ways. But despite that, there’s a couple of countries in Africa that are leading the way.

“As a company, we understand what the African markets need, so we are able to recommend a system that’s built specifically for this whether it be for an airport like JFK or Dubai or smaller scale regional airports. We have to make sure that the solution is customisable and scalable to fit in the small airport as well as the big or large airports.” said Khaled. Collins always keeps in mind the idea of scalability to make sure that if an airport wants, for example, to add a terminal, or to remotely host another airport somewhere else in the country, it can use existing infrastructure that the main hub airport has invested in rather than trying to build everything from scratch again.

The future of the post-COVID airport will need to include many solutions to ensure a seamless, safe journey – not just for passengers but for airport staff, ground teams, and airline crews as well. Biometrics will continue to fuel these innovations from accelerating immigration processing, to moving passengers through the system from before arrival to the gate with their mobile device or facial recognition, to identifying crew members.

“Working together, we can drive these ideas forward and continue to provide technology that lowers costs, engages the passengers and improves efficiency,” Khaled concluded.

Technology is playing a significant role in the recovery and biometrics is going to be the key enabler by providing a contactless journey through the airport.

Author: Collins Aerospace

AFRAA’s 53rd AGA sets roadmap for the transformation and the economic development of air transport in Africa

Air transport leaders and decision makers set a roadmap for transformation and the economic development of air transport in Africa at the 53rd AFRAA Annual General Assembly and Summit. The event was held under the patronage of the Government of Angola under the theme: “Flightpath to Africa’s resilient travel ecosystem” and was opened by Honourable Ricardo de Abreu, the Transport Minister of the Republic of Angola.

The AFRAA AGA is the premier gathering of African airline CEOs and high level aviation executives in Africa and across the globe. This year’s event was hosted by TAAG Angola Airlines in virtual format. The Assembly brought together over 400 delegates from 51 nationalities across the globe comprising of decision-makers and aviation leaders. International and regional air transport associations including the African union, IATA, ICAO, AFCAC, ALTA were also represented at the event.

The Assembly concluded with the adoption of three (3) industry resolutions to advance the cause of African aviation:

i. Resolution on safe reopening of borders

Recognising that safe reopening of borders in a harmonised manner is critical for the efficient restart of African aviation, the Assembly urged African governments to remove border restrictions and open their markets to restart the industry with support from Industry Restart Plan Standards and guidance documentation. The Assembly further called upon African governments to accelerate the rapid roll out of vaccines across the continent and embrace the use of digital technology health platforms to facilitate the restart of economies and air transport.

ii. Resolution on financial support to African airlines

Recognising the importance of financial support for the recovery of the air transport industry, the Assembly called upon African governments to extend the muchneeded financial support and relief to African airlines and the African aviation industry at large.

iii. Resolution on Lab concept approach for attainment of sustainability of African airlines

Recognising the importance of addressing the sustainability and competitiveness of Africa’s air transport, the Assembly called for a laboratory convening all relevant stakeholders as a transformation opportunity for the economic development of air transport in Africa. AFRAA Secretariat in coordination with the African Union Commission (AUC), The African Civil Aviation Commission (AFCAC), and the African Aviation Industry Group (AAIG) shall convene the LAB by the end of March 2022.

OPENING CEREMONY AFRAA President Welcome address

In his welcome address, the President of AFRAA, Mr. Rui Carreira said, “This AGA presents a unique forum for airlines and stakeholders to discuss, share ideas and explore solutions that can be implemented to rapidly restore the airline industry. African airlines should utilise this opportunity to emerge stronger and more resilient out of the crisis to face the challenges of the industry. Cooperation and collaboration among African airlines through initiatives such as network coordination and joint cost containment are among the initiatives that will enable airlines rapidly overcome the impacts of the pandemic.”

He further stated, “Let us focus on improving and promoting the cooperation, and collaboration among African airlines. We need to place development of intra African

connectivity at the top of our priorities in order to increase air connectivity between our countries.”

Keynote speech by the Minister of Transport of

the Republic of Angola

The Chief Guest, Honourable Ricardo de Abreu, the Transport Minister of the Republic of Angola in his opening speech remarked: “This AGA is the perfect occasion to address the future of African Aviation and enhance stakeholders’ commitment to enable the multitude of benefits to be experienced across all sectors of our economies. Failure is not an option, together we will succeed. He highlighted various ongoing measures and initiatives by the Angolan Government to improve the aviation sector and develop Luanda into an efficient hub.”

Honourable Ricardo de Abreu highlighted Angolan commitment to improving the aviation sector and belief in the benefits of the aviation industry:

• Opening of the airspace for all operating carriers.

• Encouraging growth in the no. of airlines and passengers.

• Engaging with the relevant bodies for technical assistance programmes which aim to improve compliance according to international aviation security, supervision and monitoring standards.

• The government recently approved a law which will enable civil aviation authority to become fully autonomous and independent entity which will benefit the national aviation ecosystem.

• Construction of Luanda International Airport, revamping and improving operational capacity standards of main airport networks.

• Improving Air Traffic Navigation Systems and modernising them to the technical standards.

We will keep by our mission to promote and serve African airlines and champion African aviation industry. Better skies for African remains the pillar of all our actions.

Author: AFRAA

For the AGA, he stated, “I am sure that this is a perfect occasion to address the future of African aviation and enhance your commitment to ensure the contribution of all stakeholders to enable a multitude of benefits to be able to experience across all sectors of our economies.”

Speech by AFRAA Secretary General

Mr. Abdérahmane Berthé, AFRAA’s Secretary General, stated: “This year’s Assembly provides an opportunity to rethink our industry and develop a resilient and sustainable perspective for the airline industry. AFRAA will keep by our mission to promote and serve African airlines and champion Africa’s aviation industry – Better skies for Africa –remains the pillar of all our actions.”

Looking at recovery, Mr. Berthé highlighted that the ingredients for successful restart include: Safe travel measures, removal of travel restrictions, financial support to airlines, technology to shape the ‘new normal’, reinvention and redefinition of airline business models, cooperation among African airlines and passenger confidence. He continued, “We will keep by our mission to promote and serve African airlines and champion African aviation industry. Better skies for African remains the pillar of all our actions”

He concluded by showing his appreciation to all the attendees and recognising that the attendance served as a remainder of the importance of the aviation industry for economic development and integration of the African continent.

Speech by AFCAC Secretary General

Mr. Tefera Mekonnen Tefera, AFCAC Secretary General commended this year’s AGA theme, “Flight path to Africa’s resilient travel ecosystem.” Remarking that the COVID-19 recovery process has been slow and restoring passengers confidence in the travel industry is essential to the full resumption of aviation operations.

Mr. Tefera gave the following recommendations for the industry to navigate through from the pandemic:

• Appealed to the government to provide financial relief measures to airlines and related air service providers as quickly as possible;

• He urged the industry to be willing to adapt to ongoing transformation of economies, society and consumer behaviour to minimise the negative operations and efficiency impact;

• He urged the industry to dwell on the positive side of the pandemic by focusing on the opportunities to transform the airline industry.

On AFCAC activities and initiatives to support the industry, he highlighted the following:

• AFCAC would not relent in promoting collaboration and collective engagement with different stakeholders to continue to implement the AU High Level Task Force Recommendation and the ICAO task force take off guidelines documents which have aimed to establish aviation industry resilience and strengthening the aviation public health confidence, passengers, aviation workers and the general public at large.

• AFCAC continuation on prioritising safety using the risk based approach recommendation established by ICAO take off guidelines to ensure sustainable development of air transport as well as realisation of the social economic development benefit produced by aviation.

• AFCAC is offering a series of training assistance programmes meant to assist eligible airlines with SAATM states for IATA Operation Safety Audit. He concluded by emphasizing on the implementation of SAATM which will play a vital role in restarting and growing the air travel ecosystem in Africa.

Speech by Regional Director, ICAO-ESAF

In his speech, Mr. Barry Kashambo recognised the efforts by different stakeholders in the industry to restart the industry. In particular, he commended AFRAA for its efforts remarking, “ICAO appreciates the actions taken so far by AFRAA to mitigate the COVID-19 pandemic and its challenges on civil aviation and air transport as a whole.”

Mr. Kashambo made emphasis on ICAO’s support towards the industry. He stated: “We also recognise the strategy to sustainably recover even as we strive to build a resilient future in line with ICAO cut report guidance materials and in tandem with the AU high level task force recommendations.

Mr. Barry Kashambo recognised the importance of implementing the Yamoussoukro Decision, “The benefits of connectivity cannot be over emphasised as demonstrated by AU study of the benefits of SAATM and African states and operators must take an extra mile to harness the potential for the passenger and air cargo,” he said. He called upon States, operators and service providers to invest in new technology to enhance compliance with the relevant regulations and to improve efficiency.

Speech by IATA Director General & CEO

Mr. Willie Walsh, Director General & CEO, IATA acknowledged the critical work done by the industry through collaboration to power a sustainable recovery for African aviation from COVID-19. On recovery, he noted, “The worst is behind us. Data shows us that when travel restrictions are lifted, people will fly. With Most borders now open to travellers across the continent there is little stopping intra-African travel. But we should not underestimate the challenges to reestablishing global connectivity.”

On health and safety measures, Mr. Walsh briefed the Assembly on IATA’s recovery vision which is based on the following:

• Vaccines being available for all;

• No restrictions on vaccinated travellers;

• Testing facilities for travel for those without access to vaccine;

• Cost effective antigen testing for travel purposes;

• Government paying for testing if they make it a requirement.

In addition, he called upon governments to work harder and have more inclusive testing solutions that will enable travel for those without access to vaccinations. He recommended that African States replace PCR testing with antigen test for travel, noting that there are excessive costs in PCR testing in Africa. He further called upon African States to manage travel health credentials with digital solutions like the IATA Travel Pass or the AU Trust Travel Pass.

On financial viability of African airlines, Mr. Walsh urged African States to release blocked funds and offer additional financial relief to the African airlines.

Keynote speech of African Union Commission

Mr. Moses Bayingana, Ag. Director Infrastructure and Energy in his speech highlighted the importance of implementing SAATM. He noted, “SAATM is indeed among the 12 flagship project of the AU Agenda 2063. Its main objective is to create one Single Air Transport Market in Africa, liberalise air transport services and drive economic integration. As a flagship project of the AU Agenda 2063, the SAATM strongly supports continental free trade agreement and free movement of persons.”

On AUC work to push the SAATM Agenda, Mr. Bayingana highlighted the commissions’ initiatives in collaboration with AFCAC as follows:

• Advocacy for all member states to join the market;

• Resource mobilisation and strengthening of the executive agency AFCAC and finalisation of the regulatory instruments of the SAATM as well as aviation infrastructure, safety, security and aviation financing;

• Through AFCAC, the AUC has collaborated with other stakeholders to prevent the spread of COVID-19 and position the aviation sector on a new path to restart, recovery and sustainability.

He concluded by commending the importance of the AFRAA 53rd AGA, “This 53rd AGA should provide an opportunity to clearly identify all the challenges faced by African airlines, not only to reopen operation and recover from COVID-19 but also to reposition the African aviation industry on a new path towards sustainability.”

Annual report of the Secretary General AFRAA Secretary General presented an analysis of the previous year (2020) industry situation, the current situation (2021) and outlook for the next year (2022).

According to the report, due to the COVID-19 outbreak, economic activity slowed down sharply in 2020. This resulted in a contraction of 3.5%.

Estimated revenue loss for African airlines due to the pandemic in 2020 was USD 10.21 billion representing 58.8% of 2019 revenues while in 2021, the estimated revenue loss is USD 8.5 billion representing 49% of 2019 revenues.

Compared to February 2020, African airlines reopened 81.3% of their international routes in October 2021.

On the future outlook for 2022, Mr. Abdérahmane Berthé outlined the following recommendations for recovery;

• Safe travel measures and removal of travel restrictions;

• Financial support to airlines;

• Technology to shape the ‘new normal;

• Reinvention and redefinition of airline business models;

• Cooperation among African airlines;

• Passenger confidence.

Presentation 1: Impact of COVID-19 and economic imperatives for recovery

In his presentation, Mr. Patrick Baudis, VP, Marketing, Advisory Market InsightsMHIRJ gave insights on the position of Africa in the COVID-19 Impact.

The report revealed that African airlines had reopened 81.3% of their international routes in October 2021 and recovery in Africa & Middle East has been smoother and steadier than in Europe and Asia. However, the sub-regional growth in Africa is varied and driven by different market dynamics. It was also reported that during the pandemic 300 routes equivalent to 25% have been shut down, mainly international but at the same time, 90 new routes have been launched. Out of the top 100 routes in Africa, 44% have higher frequencies in 2021 than in 2019.

The analysis further revealed that African airlines have been growing regional fleet since 2020, allowing a deeper market penetration and a better feed. African cargo capacity grew by 33% since 2019 and cargo load factors improved by 9% from pre-pandemic levels. The dawn of recovery is critical time to redefine strategic plans for the next five years.

CEOs roundtable: Time for take-off-building Africa’s resilient travel ecosystem

To set the scene, the moderator, Mr. Matthias Kern, Associate partner, Lufthansa Consulting gave an analysis of Africa’s Air Transport resilience or (lack thereof) during the pandemic:

• 2% of traffic of global traffic despite 18% of global population;

• -2% GDP in 2020;

• 33% grounded fleet; highest worldwide;

• 56% load factors which are 10 % below worldwide average;

• Lowest level of travel restrictions;

• 1.2% of worldwide COVID cases; 6% vaccination rate.

What role can the government play in building Africa’s resilient travel ecosystem?

Eng. Joao Carlos Po Jorge, CEO LAM Mozambique remarked, “One of the biggest hurdles we have is financing. The financial systems the financial institutions must find a way that we do not compete with one of the biggest capital consumers which is aircraft acquisition.”

Mr. Kane Ibrahima, CEO, Air Senegal said, “Taxes we are facing as operators based in Africa are creating the big issue. This is the biggest question we need to address. It makes our companies much less effective than others, much less competitive than others.”

He also added that government should assist in financing and regulations that make it easier for operations.

Mr. Nowel Ngala, Director Commercial and Ground Operations, ASKY Airlines added, “Government need

to help us reduce the cost of operations and one of the areas is on the issue of taxes that are exorbitant.” In addition, he emphasised on harmonisation of activities and policies to make it easier for collaboration and growth within the industry.

Mr. Sanjeev Gadhia, CEO of Astral Aviation echoed the sentiments of his fellow panellist, “We must address the issue of taxes or royalties that are affecting the industry. African airlines pay a lot of taxes. When you look at the amount of taxes we pay, we are only working for the government and not for the growth of the airlines.”

What are the recommendations on how to make the African Travel System more resilient?

Mr. Ngala said: “We all join hands and fight the elements in order to get solutions and make sure we grow the African aviation industry. One of the areas is partnership. We should understand that in partnership, we grow together.”

Mr. Sanjeev Gadhia stated: “We need to collaborate more aggressively and more effectively with each other. We need to make sure we operate very leniently, efficiently and also make sure that we conserve cash.”

Eng. Joao Carlos Po Jorge remarked: “We need to invest massively in training; the next few years are going to demand a lot of work from us. We want to grow, the economies are growing, and the industry is going to grow.”

Mr. Kane Ibrahima said: “Talking together, having a common plan/goal will make discussions much more effective, much more efficient, to build this common business and develop partnership, develop number of travellers that will take our airlines and the no of cargo.”

Mr. Kane Ibrahima CEO - Air Senegal

Mr. Nowel Ngala Director Commercial & Ground Operations ASKY Airlines

Mr. Matthias Kern Associate Partner Lufthansa Consulting Moderator

Mr. Sanjeev Gadhia Chief Executive Officer Astral Aviation

Mr. Joao Carlos Po Jorge Chief Executive Officer LAM Mozambique

Executive session 1: Continental benefits of liberalisation

In her presentation, Ms. Adefunke Adeyemi echoed the statement by the Director General of IATA, Willie Walsh in his speech at the 53rd AFRAA AGA opening ceremony, “Connectivity is going to be essential towards ensuring meaningful recovery, for both the aviation industry and for economies around the world,” she said.

The presentation shared the results of a study IATA conducted on the implementation of the Yamoussoukro Decision on African states. The study results had two overarching themes on the major obstacles in implementing the Yamoussoukro Decision;

• Non-prioritisation of the aviation industry;

• A policy of survival hinged on protectionism. From the study, Ms. Adeyemi highlighted key recommendations for SAATM states to address challenges they face with implementation as follows:

• All states to achieve the minimum 60% effective implementation score for ICA SARPs;

• All airlines with IOSA certification should be supported to maintain their good standing on the registry;

• States need to urgently address their aviation infrastructure gaps;

• There must be concerted efforts to bring down the high taxes and charges environment by states;

• SAATM States (those that have signed the solemn Commitment) need to remove the requirements for approval for Foreign Operations Specification (Foreign OpSpecs ). ‘Fire and Fly’ should be fundamental aspect of the SAATM.

The following benefits of SAATM to the economy were discussed:

• Liberalisation; lower fees, Increased frequencies and enhanced connectivity;

• Air traffic growth; increased tourism, increased trade, investment and productivity;

• Economic growth, jobs growth and socio economic development.

Executive Session 2: Airport customer and employee experience management

The session was led by Mr. Dimitri Coll, VP, Airport Customer Experience at ACI World. He highlighted the definition of customer experience from an organisation perspective;

Consistency in the delivery by the organisation;

• Customer journey consistency;

• Emotional consistency;

• Communication consistency;

• Promises made vs promises kept.

He then highlighted the customer experience management model;

• Customer understanding

• Strategy

• Measurement

• Operational improvement

• Governance

• Airport culture

• Service design

• Airport community collaboration.

Mr. Coll discussed in detail the drivers of customer satisfaction before and during the pandemic.

Executive Interview 1: How do we revamp Aviation, Tourism and Trade in Africa through implementation of SAATM and AfCFTA?

To set the scene for discussion, Mr. Gaoussou Konate, Director Technical and Operations, AFRAA outlined Africa’s potential and the challenges African aviation is facing to tap the potential.

When asked on how South Africa Government is supporting the recovery of the industry, Ms. Sthembiso Dlamini, Acting CEO of South African Tourism highlighted the South African Tourism recovery plan which consists of three pillars;

• Rejuvenate the supply side;

• Create demand in key source markets; overseas and intercontinental;

• Create enabling environment for the restart; travel facilitation.

On role the AUC is playing in the recovery process of the industry, Mr. Eric Ntagengerwa, Senior Policy Officer, Air Transport, Infrastructure and Energy Department, AUC, highlighted the following;

• High level task force aligned with the ICAO Council Aviation Recovery Task Force was put up to see how to resume operations especially on the cargo side for the delivery of testing kits, protective kits and vaccinations.

Ms. Sthembiso Dlamini Acting CEO, South African Tourism

Mr. Eric Ntagengerwa Senior Policy OfficerAir Transport, Infrastructure & Energy, AUC

Mr. Gaoussou Konate Director Technical & Operations AFRAAModerator

• AUC Collaborated with different stakeholders in the industry and the health industry and put up a task force to harmonise health protocols to ensure interoperability between digital certificates and to ensure those certificates were recognised in both Africa and other continents.

To conclude the session, both speakers emphasised the need to focus on implementation of SAATM and AFCFTA. “The research is out there, we need to get the work done. Take small steps and get small wins to fully achieve implementation.” Ms. Sthembiso Dlamini remarked.

Executive Interview 2: Policy framework and smart regulations to attain conducive environment for African air transport growth and sustainability

regulations to attain conducive environment for African Air Transport Growth and Sustainability, Mr. Alberto Adiron, Regional Officer, Air Transport and Technical Assistance ICAO-ESAF outlined;

• Liberalisation of market access;

• Air carrier ownership and control; strategic partnerships;

• Consumer protection; air passenger rights, freight rights and airline pricing transparency;

• Fair competition;

Ms. Angeline Simana, Director, Air Transport, AFCAC resumed the session by highlighting the challenges the African Air Transport faces and the potential the industry has by overcoming these challenges through smart regulation.

On how the challenges the African Air Transport Industry faces can be resolved through policy framework and smart

• Taxes and levies imposed on civil aviation to be reduced.

Mr. Alberto Adiron emphasised on the importance of the above mentioned solutions towards achieving growth and sustainability. In addition, he emphasised on collaboration, implementation of intra-African air travel, funding and airline consolidation.

Panel Discussion 2: Post-COVID competitiveness of African Air Transport

In his introductory remarks, the moderator, Mr. Raphael

Director Government Legal and Industry Affairs,

gave a background on the African Air Transport industry challenges during the pandemic especially the financial aspect, with airlines facing bankruptcy and liquidation.

Session highlights

How the African air transport industry is fairing in terms of recovery;

• There have been restrictions that have made intra-African air travel difficult to implement.

• Domestic travel is leading the charge in the recovery followed by regional travel.

• State owned airlines have received direct contribution from the government while private owned airlines have had to prove themselves and source funding like any other company.

Future business strategies for the African air transport for post recovery competitiveness were recommended as follows:

• Digitalisation and regionalisation

• Flexibility and versatility in network and fleet

• Focus on efficiency and sustainability

• Embrace and adapt to new technologies

• Investment in human capital

• Connectivity

Mr. Alberto Adiron Regional OfficerAir Transport & Technical Assistance, ICAO-ESAF

Ms. Angeline Simana Director Air Transport, AFCAC - Moderator

Mr. James Bosse Director SalesDe Havilland Aircraft of Canada Limited

Mr. Nowel Ngala Director Commercial & Ground Operations

Mr. Raphael Kuuchi Director

Government Legal & Industry AffairsAFRAA - Moderator

Mr. Randal L. Heisey MD, Commercial Marketing - Boeing Company - EMEA

Kuuchi,

AFRAA

Mr. Francisco Moraes Sales DirectorEmbraer

Presentation 2: Airline retailing

The presentation at the 53rd AGA was made by Mr. Deepak Garg, Senior Manager, Business Development, SITA for Aircrafts. He began his presentation by outlining the contact point of customers in airline retailing;

• Searching for a ticket

• Buying a ticket

• Checking in (online / kiosk / desk)

• Loyalty portal

• In the aircraft

Mr. Garg further highlighted the different opportunities that African airlines have on airlines retailing, these included;

• Large continent

• Booming economy

• Rich and vast natural resources

• Progressive digital cash system such as M-pesa in Kenya

• Strong mobile network

• Weak road and railways system; opportunity for air transport.

On airline retailing in Africa, Mr. Garg made the following recommendations;

• Digitalise paper-based sales operations: increasing administration efficiency;

• Optimise sales managers’ decision making: identifying sales trends and patterns with data;

• Unlock sales visibility: real-time reporting on all relevant activities;

• Personalise in-flight sales: purchasing analysis to understand passengers’ preferences;

• Reduce costs of sales operations: consistent stock analysis to avoid wastage and overbuying.

Optimising retailing for airline profitability

The session was led by Mr. Steven T. Kargman, President, and Kargman Associates in which he commenced the session by highlighting the benefits of retailing to African airlines: to achieve greater efficiency in their operations, tap into new revenue streams and achieve greater profitability.

Session highlights

• Customers have higher expectations of their digital experience and they need reassurance and guidance across all of their different touch points with the airlines.

• Retail solutions can incorporate technologies like new distribution capabilities and merchandizing to meet requirements at each customer touch points from their higher expectations.

• There is need for automation.

• To achieve efficiency and cost saving, airlines need to expand to ancillary services and bundling. In addition, they need to adapt to new technologies.

2022 Officials of the association

The 53rd AFRAA AGA elected Mr. Ibrahima Kane, Chief Executive Officer – Air Senegal as the President of the Association for the year 2022. Capt. Pascal Kasongo Mwema, Chief Executive of Congo Airways, Ms. Yvonne Makolo Chief Executive of RwandAir and Mr. Mohamed

Khalifa Biyah, CEO of Mauritania Airlines were re-elected as the Chairman, 1st and 2nd Vice Chairmen for the year 2022 respectively.

Host of the 54th AGA

Air Senegal will host the 54th Annual General Assembly set to be held in November, 2022 in Dakar – Senegal.

Panel Discussion 1:

Mr. Akrem Aloui Head Airlines SolutionsAmadeus-EMEA

Mr. Bryan Porter Head of CommercialAccelya - EMEA

Mr. Cem Kirgiz Sales Director - Hitit

Mr. Christophe Viatte Director & Head of Sales Engineering - Sabre Travel Solutions

Mr. Steven Kargman President - Kargman Associates - Moderator

Drivers of the Aviation Industry Growth in Africa

Study powered by AFRAA economics models

AlthoughAfrica represents 15% of the global population, in 2018 airlines present in African airspace operated only 5.5% of the world’s commercial passenger and freight aircraft1. In terms of aviation industry competitiveness over time, Africa continent is still not performing as per the average expectation, despite the recent notable general improvement. Air traffic growth in Africa has been on an upward trend since 2011 with the passenger services being the key contributor having grown at a rate of 4% in 20192 fueled by a conducive global economic environment. In terms of profitability, majority of African airlines have been incurring losses as the majority of non-African airlines earn profits. However, the African aviation market has been hailed as one with high potential for growth owing to the continent’s growing youthful population and the emerging industrial sector3. Against this background, it is necessary to determine the drivers of the aviation sector growth in Africa. This study identified three key indicators of performance in the sector as: growth in air passenger demand, air cargo transportation and revenue. With significant growth in passenger demand and volume of cargo transported, revenues in the sector grow. The determinants of air passenger demand, cargo transportation and airlines revenue are therefore critical in evaluating the drivers of growth in the industry.

This study estimated the air passenger demand model, to establish factors that influence air travel demand. Due to lack of consistent data on cargo transportation along various routes and its associated factors, revenue model was estimated. Estimation of the models were based on Data for selected 106 busiest city pair spread across the five regions of Africa, over a five-year period (2016 to 2020). The 106 city pair routes in Africa (See Appendix: Table A1 and A2) comprised of 48 within regions and 58 across regions.

a) Air passenger demand in Africa

The two core functions of airlines (aviation) is to transport passengers and cargo. Growth in air passenger demand, all things constant leads to growth in aviation revenues and consequently growth in the industry. Figure 1 shows the trend of air passenger demand in Africa on a quarterly basis from 2016 to 2020.

In the estimated passenger demand model, the aggregate number of air passengers for each city-pair route in a year was assumed to be influenced by annual average fare, level of economic activity in the associated countries captured by gross domestic product (GDP), Distance, and population of the two countries.

1https://www.nortonrosefulbright.com/en/knowledge/publications/250cfc0e/africa---is-it-a-major-untapped-market-for-the-airline-industry

Figure 1: The Trend of Air passenger demand in Africa, 2016 Quarter 1 to 2020 Quarter 4

Dummy variables were included to capture the impact of air liberalisation (period after the signing of the Single African Air Transport Market – SAATM and subsequent participation); regional operation (whether the route was within a region or interregional) as well as the impact of

corona pandemic. The sensitivity of passenger demand to the economic and demographic variables captured by the elasticity values provide critical information of the relative importance of each variable in driving its growth. The estimated elasticity values are shown in Table 1.

Variable Elasticity Comment

Average fare

-0.301 On average, 1% increase in average fare results to a 0.301% fall in demand for air transport

GDP 0.226 on average, 1% growth in GDP results to a 0.226% rise in demand for air transport

Distance 0.349 On average, 1% increase in distance results to a 0.349% rise in demand for air transport

Population 0.242 On average, 1% growth in population results to a 0.242% rise in demand for air transport

Liberalisation (dummy)

0.075

Regional operation (dummy) -1.62

Corona pandemic (dummy)

-1.019

Presence of liberalisation results to significant rise in demand for air transport

Restriction of airline services within regions results to significant reduction in the number of air transport passengers

Presence of Corona pandemic significantly reduces the number of air transport passengers across Africa

Note: Elasticity measures the percentage change in number of passengers a result of 1% increase in the respective variable

The model predicts with over 90 percent confidence that average fare, GDP, distance, liberalisation effort, the corona pandemic, and regional operations influenced air passenger demand in the study period. Population was established to influence demand but with a lower level of confidence of 87%.

b) Airlines revenue model for Africa

Airlines revenue captures the market value of total airlines services in a given period and therefore constitute the value of tickets sold. The aviation sector is assumed to grow with the growth in airlines revenue. Figure 2 shows the trend of airlines revenue in Africa on a quarterly basis from 2016 to 2020.

Table 1: Elasticity of Air passenger demand to economic and demographic variables

Figure 2: The Trend of airlines revenue in Africa, 2016 Quarter 1 to 2020 Quarter 4

The study estimated a model for the annual aggregate airlines revenue per city pair route as dependent on average fare, distance between the city pairs, trade volume, population, and dummies to capture regional operation, liberalisation, and Corona pandemic. Variables associated

with volumes of cargo transported were not available from the accessible data sources. The relative importance of each variable in explaining aviation revenue growth are given by the elasticity values obtained from the model and shown in Table 2.

Table 2: Elasticity of airlines revenue to economic and demographic variables

Variable Elasticity Comment

Average fare

-0.583 On average, 1% increase in average fare results to a 0.583% fall in airlines revenue in Africa

Trade volume 0.063 On average, 1% rise in trade volume results to a 0.063% increase in airlines revenue in Africa

Distance 0.364 On average, 1% increase in distance results to a 0.364% increase in airlines revenue in Africa

Population 0.0093 On average, 1% growth in population results to a 0.0093% increase in airlines revenue in Africa

Liberalisation dummy 0.063 Presence of liberalisation results to significant increase in airlines revenue in Africa

Regional operation (dummy)

Corona pandemic (dummy)

-1.785

Restriction of airline services within regions results to significant reduction in the airlines revenue compared to those operating at cross-regional level in Africa

-1.043 Presence of Corona pandemic significantly reduces the airlines revenue across Africa

Note: Elasticity represents percentage change in aviation revenue as a result of 1% increase in the respective variable.

The estimations predict with more than 90 percent confidence that airlines revenue in Africa is influenced by average fare, distance, corona pandemic and air liberalisation efforts. It also shows that revenues were significantly low during the pandemic. The impacts of increase in trade volume and population are consistent with theoretical predictions but the level of confidence in the estimates is low.

c) Drivers of aviation growth

From the Passenger Demand and Airlines Revenue models, we conclude that growth in the aviation sector will be driven by critical decisions that take advantages associated with the following variables.

Average fare

The response of air passenger demand to increase in average fare is negative, showing that on average, air passenger demand as well as airlines revenue decreases as average air ticket price increases. The implication of this finding is that lowering the ticket price on routes within Africa can increase demand for air travel and consequently lead to growth in the airlines revenue. These results imply that, all things constant, airlines can spur the growth of passengers and revenues on routes of operation by taking measures within their means to reduce the ticket price, such as offering discounts on tickets. Negotiations with governments to reduce sector specific taxes and charges, lower cost of jet fuel, can also help reduce costs and translate to lower ticket prices. Such actions can also significantly reverse the negative effects on revenue growth.

Growth in economic activity

The models show that air passenger demand as well as aviation revenue increases as economies experience increase in economic activities proxied by growth in GDP or per-capita GDP and trade volume. During periods of economic booms, the rising incomes, all things constant, increases aggregate demand for goods and services including air travel. Increased demand for imports and growing volumes of exports also increase quantities of goods transported from one city to another as well as from one region to another. Growth in economic activities therefore provide a positive exogenous shock to the aviation sector. Therefore, measures taken to improve the GDP of any country will by extension result to growth of the aviation sector. Airlines can tap into the advantages of economic expansion by implementing discounts on tickets and bookings during periods of high economic activities in countries. The results also imply that a fall in economic performance hurts the growth of the aviation sector in any African economy.

Corona pandemic

Both air passenger demand and airlines revenue significantly dropped during the corona pandemic. This was due to the closure of borders by most countries to contain the spread of the virus that greatly prohibited passenger travels and a massive negative impact on economic activities arising from lockdowns and cessation of movement. The results are a pointer that post-pandemic economic recoveries will be very critical to the aviation sector. Airlines should aggressively

negotiate for enactment of fiscal and regulatory conditions that will be favorable to them for post pandemic recovery in the sector.

Long distance Operations and Inter-regional operations

Air passenger demand as well as airlines revenues increase with increase in distance and operations on cross regional routes. Airlines that operate on longer routes attract more passengers possibly because for longer distance, air transport is the only convenient and quick means of transport within Africa. Therefore, airlines should expand operations on further apart city pair and interregional routes. The model results also showed that airlines operating at regional level attracted fewer passengers than those operating on cross-regional routes. Revenues were also higher on cross regional routes than on regional routes. Therefore, airlines that are interested in attracting more passengers can expand their operations beyond the regional level. Targeted inter-regional operations can generate more revenues and enhance for growth of the aviation Industry in Africa. This would in turn translate to sector.

Population growth

Air passenger demand and aviation revenue were both shown to be positively associated with growth in population in Africa, suggesting that all things constant, number of people who use air travel increases proportionately with

population. Airlines in Africa can take advantage of the population growth by investing in high capacity carriers and implementing discounts on ticket prices to attract more passengers from the growing Africa’s population.

Aviation market liberalisation

Air passenger demand and airlines revenue were established to be on average higher in the period after adoption and implementation of market liberalisation measures. That is after 2018 with the signing of the Single African Air Transport Market (SAATM) agreement. This is a validation that SAATM measure are already impacting the aviation sector positively. Therefore, aviation industry players should mount pressure on full air liberalisation to realise meaningful impacts on growth of the industry. Further, there is need for enhanced coordinated efforts to pressure for full adoption and implementation of the liberalisation agreements to catalyze the industry’s growth.

Suggestions for future analysis

The analysis done in this study can be improved if data on volume of cargo transported by air and the cost per unit of cargo transport is available.

The aviation profit forecasting model can also be estimated when historical data is available on jet fuel prices, aviation taxes, airport charges, and cost of cargo transport.

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AFRAA to lead an all-Inclusive laboratory for out-of-thebox solutions to effectively implement the SAATM and AfCFTA and to address the sustainability of air transport in Africa

1. Introduction

Africa’s air transport which is at less than 3% share of the world air traffic is far from maturity. In addition to its modest size, Africa’s air transport stagnated around 2.3% of the world market along the last 40 years. Despite Africa’s growth potential being among the fastest rates compared to those of the matured air transport markets, the industry economists forecast Africa share to be 2.4% of the world air transport market by 2030. From the 1980s to 2019, African airlines lost market shares to foreign air operators continuously. By the end of 2019, African airlines serviced 20% of the African market while foreign air carriers served the 80% balance. The forty-year historical trends and the ten-year future forecast together point to the marginalization of Africa’s air transport market.

African air transport faces a myriad of challenges. African airlines haven’t recorded average profits since 2010 whilst airlines from other regions of the world were profitable from 2010 after recovery from the global economic crisis. This marginalization trend is a strong wake-up call to all stakeholders to identify the root causes and develop relevant solutions to revamp Aviation in Africa. As a result of expensive fuel prices, and the low productivity of the stakeholder along the supply chain African air transport is not competitive.

Indeed, the total travel ticket prices are double compared to Europe. Yet, the revenue per capita in Africa is lower than the same European indicator. Consequently, with the GDP, an African middle-class citizen can afford only 1.1 trips by air per year while his counterparts can purchase respectively 5.4 trips in Latin America, 6 in the Asia Pacific, 11 in the Middle East, 26.4 in Europe and 33 in North America. Stakeholders must engage in addressing the fact that African citizens have the lowest GDP, yet they are the ones to pay the highest fares to travel by air.

In 2020, along came COVID-19 pandemic which aggravated the situation of African aviation. All stakeholders in the supply chain were impacted by the pandemic including: ground handling service providers, airlines, airport operators, air navigation service providers, aircraft lessors, and civil aviation authorities. This state of affairs makes the wake-up call to all stakeholders to cooperate and develop relevant solutions to revamp aviation in Africa more acute. The industry restart and recovery must be viewed as an opportunity for the aviation industry ecosystem to address the issue of sustainability of aviation in Africa

2. Discussion

Transformation is necessary to ensure the survival of air transport in short-term and its sustainability in long-term in Africa. In order to address the issue of sustainability of African aviation, appropriate measures need to be implemented in a coordinated and collaborative approach. Out-of-the-box solutions by stakeholders are needed to ensure that Africa achieves the following:

i. Liberalisation of access to air transport markets and trade in line with what pertains in other regions of the world through effective implementation of SAATM and AfCFTA;

ii. Appropriate economic oversight and regulation to ensure implementation of policies on aviation taxes and charges in line with ICAO policies on taxes and charges and other non-tariff barriers and domestication and application of the relevant provisions of the African Civil Aviation Policy (AFCAP) and the Yamoussoukro Decision (YD);

iii. The industry’s competitiveness and cost structure for air transport in Africa

The all-inclusive LAB approach

Addressing the factors that negatively impact on the industry’s sustainability and competitiveness in Africa such as high operational costs, affordability of air transport, market restrictions will result in the blossoming of air traffic growth and intra-Africa connectivity. The efficient implementation of AfCFTA will foster the development of the intra-Africa trade which will stimulate new air traffic demand and support intra-Africa connectivity. The interrelatedness of AfCFTA and SAATM for the economic development of Africa buttresses the wake-up call to all stakeholders to cooperate and develop relevant solutions to revamp Aviation in Africa.

On this backdrop, a laboratory convening all relevant stakeholders is an excellent transformation opportunity for economic development and will be key to innovate for short term survival and medium-term sustainability & competitiveness:

a. Airlines, ANSPs, Airports, CAAs must innovate to make the African air transport safer, competitive to become an efficient logistic system to support;

b. The manufacturing sector, trade, hospitality, and other vital economic sectors should anchor their businesses on AfCFTA and SAATM and;

c. The Development Financial Institutions need to support this virtuous cycle transformation of economic development as Africa’s priority.

Strategy and approach for the LAB on effective implementation of AfCFTA and SAATM

The LAB’s purpose avoids individual stakeholder incremental improvements; instead, the set objectives require the participants to seek out-of-the-box solutions to implement AfCFTA and SATAM collectively and efficiently;

• Manufacturing industries transform Africa’s raw materials into competitive products to develop intra-Africa trade to rise to 50% by 2025;

• Each stakeholder in the Aviation supply line reduces costs significantly to ensure that air passengers and freight forwarders pay total fares and cargo rates three times lower than 2019-prices by 2025;

• Aviation supply chain stakeholders make air transport affordable to African citizens;

• Both trade and tourism sectors demand that aviation stakeholders’ efforts promote intra-Africa trade and tourism competitiveness further. The growth of these sectors yield new air traffic demands for the benefit of aviation;

• Financial institutions to fund the initiatives that support the manufacturing industry, hospitality, trade, and air transport expansion. AFRAA, in coordination with the African Union Commission (AUC), the African Civil Aviation Commission (AFCAC), and the African Aviation Industry Group (AAIG) shall convene the LAB in Q1 2022.

3. Conclusion

The LAB is an all-inclusive approach which will enable stakeholders and experts understand the reasons behind the status-quo of African air transport and develop headways for sustainability of African aviation in manner that is impactful and data driven to change policies that are not working. The time proposed is appropriate to conduct the LAB which will set the right priorities to revamp aviation in Africa. The LAB will bring participants from various sectors to craft out-the-box solutions, implement both AUC flagship programs, AfCFTA and SAATM.

Implementing the LAB outcomes will transform the ways of doing business in the African region to ensure the efficient development of the intraAfrica markets for the manufacturing industry, hospitality, trade, and air transport. The LAB results will also increase the respective contribution of these sectors to the GDP of African economies.

The stagnation of the air transport industry in Africa during the last 40 years has led to the marginalization of Africa’s air transport market. This is a strong wake-up call to all stakeholders to identify the root causes and develop relevant solutions to revamp Aviation in Africa. The all-inclusive laboratory approach by AFRAA will seek to establish out-of-the-box solutions for the transformation of the air transport sector in Africa.

Author: AFRAA

2021 at a glance: AFRAA actions

FEBRUARY 2021

AFRAA launches 2021 fuel process

The Secretariat launched the 2021 AFRAA fuel tender process. 12 member airlines expressed their interest to procure jointly and sent their volumes for the various locations. Over 460 million litres were procured at 83 locations. AFRAA sent out tender invitations to 95 suppliers in AFRAA prequalified

database, and received 50 bids from the suppliers interested to supply in the various locations on tender.

The Airlines contracted the awarded suppliers at the various locations for a period of 12 Months (commencing 1 July 2021 – 31 June 2022).

AFRAA launches project for the reduction of navigation charges

In line with AFRAA’s COVID-19 recovery plan pillar 6 which is on Cost Management, AFRAA held a webinar on 23 February 2021 to launch a Project for the Reduction of Navigation Charges.

This program assists member airlines with the following:

i. Improving the process of invoice validation;

ii. Enhancing strategy and operations with a Business Intelligence Tool;

MARCH 2021

iii. Viewing Big Data on a GIS portal;

iv. A unique, no cost SaaS ‘cloud ready’ solution;

v. Building bridges between the Operations and Finance department;

vi. An intuitive and ready to use system.

We continue to invite members to engage AFRAA in planning demonstrations of customized data intelligence tools and reap crucial savings on air navigation bills during the COVID-19.

AFRAA as part of AAIG define actions for reduction of high cost of Air Transport Operations and measures for sustainable growth of African aviation

The African Aviation Industry Group (AAIG) held a high level webinar to deliberate on practical solutions for the reduction of high cost of air transport operations in Africa. Staged under the theme: “Achieving Affordable Air Transport across Africa”, stakeholders at the webinar agreed on a set of actions for implementation with defined timelines to achieve the goal of a sustainable African aviation industry.

In addition to the main topic of the webinar, which is the high cost of aviation in Africa, Aviation stakeholders at the webinar further identified key challenges affecting the sustainability of African aviation such as safety and security concerns, poor intra-Africa connectivity/market access limitations and inadequate infrastructure, among others.

The forum articulated the recommendations as a matter of strategic priority on the following areas:

i. High operational costs in Africa;

ii. Air Transport Affordability;

iii. Addressing other barriers constraining the sustainable growth of African aviation (safety, intra-African connectivity, infrastructure and airline economies of scale).

The event was attended by over 250 participants comprising representatives of African aviation institutions, Development agencies, African airlines, Civil Aviation Authorities, Airport Operators, Airline Associations, government entities, Aircraft manufacturers and aviation solutions and service providers.

AFRAA and Ethiopian Airlines strengthen collaboration and Sign a Memorandum of Understanding

On 5 March 2021, Addis Ababa, Ethiopia: AFRAA’s Secretary General, Mr. Abdérahmane Berthé and Ethiopian Airlines Group CEO, Mr. Tewolde GebreMariam, accompanied by their respective leadership teams held a consultative meeting at Ethiopian Airlines headquarters in Addis Ababa.

Leaders at the meeting noted AFRAA’s on-going projects geared towards fostering of collaboration among its members, cost reduction and creation of synergies among African airlines. Various areas of advocacy by AFRAA for the sustainability of African aviation through promotion of

intra-Africa travel, reduction of high operating costs and infrastructural development were discussed.

At the occasion of the visit, AFRAA and Ethiopian Airlines signed a Memorandum of Understanding (MoU) on training that will facilitate a framework of collaboration between AFRAA and Ethiopian Airlines Aviation Academy to achieve common objectives on training of aviation professionals across the African continent. The collaboration will support the development of sustainable and safe air transport system in Africa and thereby effectively contribute to the continent’s economic development and integration.

AFRAA launches the SkyConnect leadership dialogues show

On 10 March 2021, AFRAA launched a monthly leadership dialogue series dubbed ‘SkyConnect’. The purpose of SkyConnect is to accord leadership in aviation, tourism, trade, finance and the economy, a platform to share with stakeholders developments within their sectors and how these are positively impacting aviation and the general socio-economic development of the continent. Each dialogue explores the inextricable relationship between aviation, tourism, trade and the wider economy of Africa; how to accelerate growth, promote regional integration and create jobs.

In the inaugural edition, AFRAA Secretary General, Mr. Abdérahmane Berthé took the stage to discuss:

• A review of the aviation industry;

• Post-COVID industry recovery;

• What AFRAA is doing to support the recovery;

• The inter-relationship between air transport and AfCFTA;

• COVID-19 vaccine access and distribution.

SkyConnect dialogue takes place once every first Wednesday of the month from 1400-1500 hours East Africa time.

AFRAA-Africa CDC webinar on safe reopening of Borders

AFRAA in collaboration with Africa CDC organised an insightful webinar under the theme: ‘Building Momentum for Systematic Testing and Safe reopening of Borders’ on 23 March 2021.

The webinar focused on:

• Measures for building confidence in flying;

• Analysis of CART III recommendations;

• COVID-19 testing, vaccine access and distribution;

• Lives and livelihood campaign on Safe reopening of Borders.

AFRAA attends regional workshop on Satellite Based Augmentation System (SBAS) Implementation in Africa and presents African position

As SBAS is complex, Africa requested that AFCAC arranges a continental Cost Benefit Analysis (CBA). Considering the retrofit cost of SBAS airborne equipage, AFRAA Technical Operations and Training Committee supports the required continental CBA.

However, ASECNA, supported by interested parties in Europe, is pushing for SBAS in ASECNA States’ airspace. To that effect, ASECNA performed demonstration flights with their calibration ATR42 and conducted a conference from 28 to 29 January 2021 in Lomé. AFRAA attended the Lomé event and stated the AFRAA TOTC position.

On 4 and 5 March 2021, the Secretariat attended a Regional SBAS workshop, made a presentation:

• Expressed concern about fleet retrofit costs, particularly during this period of COVID-19;

• Ensured that through Collaborative Decision Making (CDM), infrastructure development in Africa takes the views of airlines and;

• Demanded the continental CBA.

AFRAA

AFC

UNECA hold webinar on financing of African airlines and exploration of investment opportunities

On 24 March 2021, the African Airlines Association (AFRAA) in collaboration with the Africa Finance Corporation (AFC) – a pan-African Multilateral Development Financial Institution and the Economic Commission for Africa (UNECA) held a webinar to discuss financing challenges of African airlines and explore areas of support as well as investment opportunities.

APRIL 2021

In the April Series, The AFRAA SkyConnect dialogues hosted Mr. Tefera Mekonnen, Secretary General, African Civil Aviation Commission (AFCAC) for a lively, educative and thoughtprovoking discussion that edged out practical, implementable recommendations as well as point to success stories that can be emulated for accelerated results.

Participants at the SkyConnect dialogues to got insights on:

The webinar presented a unique opportunity for airlines to learn about AFC’s financing opportunities, financing options and criteria with the aim of establishment of direct engagement between AFC and African airlines.

• AFCAC’s organisation perspectives on the Aviation Industry;

• Connectivity and SAATM Implementation;

• Industry competitiveness and costs;

• Aviation policy developments;

• Role of the regional institutions and organisations in supporting Africa air transport development.

AFRAA meets IATA Regional Vice President for Africa & the Middle East

AFRAA Secretary General – Mr. Abdérahmane Berthé, had a consultative meeting on 8 April 2021 with the newly appointed IATA Regional Vice President for Africa & Middle East, Mr. Kamil H. Al-Awadhi following his recent assumption of office in March 2021. Among the follow up actions to this meeting include:

1. The engagement of the AUC Commissioner H.E. Amani Abou-Zeid to discuss the subject airlines’ financial support.

2. The engagement of the Director – Africa CDC to discuss how best to address the issue of reduction and harmonisation of PCR costs. I will shed more light on this shortly shortly.

AFRAA Distribution Committee held meeting

AFRAA Distribution Committee held its 2nd meeting on 13 April 2021. The meeting took stock of actions by the Secretariat and developments in the industry pertaining to distribution and settlement. The following main areas were covered in the meeting;

i. Current Secretariat updates in the development of a solution that will regroup a distribution and settlement system at a reduced cost for AFRAA member airlines. This follows the change of concept as directed by EXC 180 to a nonblockchain-based tool with the objective of reduction of

airline operating costs in Africa and addressing the distribution and settlement challenges faced by African airlines.

ii. Subject matter expert presentations and discussions on;

• Airline merchandising strategies for recovery

• Embracing NDC in the African market

iii. Recommendations from the air transport industry distribution chain on the usage of vouchers and refunds for consideration by Airlines.

AFRAA and ACI Africa Sign MoU for mutual support to the Air Transport Industry in Africa

On 22 April 2021, AFRAA and Airports Council International Africa (ACI Africa) signed a memorandum of understanding (MoU) to materialise their cooperation. Under the framework of the MoU, AFRAA and ACI Africa will mutually support the development of the air transport industry in Africa through collaborative actions to address safe, secure, seamless, environmentally-friendly and affordable air travel, among others.

The MoU was signed by Abdérahmane Berthé, AFRAA’s Secretary General and Mr. Ali Tounsi, ACI Africa’s Secretary General. Under the MoU, AFRAA and ACI Africa will align their actions and work jointly on the following main areas:

i. Promotion and sharing of best practices to foster constructive engagement between airport operators and air carriers;

ii. Safety enhancement initiatives in line with the Abuja safety targets;

iii. Promotion and implementation of new technologies in air travel;

iv. Data and intelligence sharing;

v. Affordable airfares in Africa using a holistic approach for the reduction of the cost of air travel;

vi. Focused think tank group, led by AFRAA and ACI Africa and comprising subject-matter experts in airports and airlines, to exchange views, steer constructive dialogues and address matters of prime importance and interest for the air transport industry on Africa;

vii. Joint events (webinars, trainings, workshops, etc.) on how to render air travel more affordable in Africa.

AFRAA – IATA – AASA meeting with AU Commissioner on airlines’ financial support

AFRAA – IATA – AASA had a virtual meeting on 28 April 2021 with the AU Commissioner for infrastructure and energy on the issue of financial support to African airlines. During the meeting the 3 associations highlighted that if urgent action is not taken to provide much needed financial relief to African airlines now, there might not be a viable African aviation industry for much longer. Should African aviation and intra-Africa connectivity be

MAY 2021

The May 2021 edition of the AFRAA SkyConnect hosted Mrs. Emily Mburu-Ndoria, Director Trade in Services who will be representing H.E. the Secretary General of the AfCFTA for a thought-provoking one-on-one dialogue with matters on the AfCFTA and how it will impact Africa.

Participants in the May edition of the SkyConnect Dialogues got insights on:

• AfCFTA and how it will impact Africa;

allowed to crumble, it will have severe implications for Africa’s socio-economic development.

The meeting made a follow up on the AUC High Level Task Force recommendation for financial support and pledge of USD 25 billion (to be secured from DFI’s – AfDB, AFREXIM, World Bank) which is instrumental to the survival of African airlines.

• Status update on AfCFTA since Jan 2021 – progress made, challenges and next steps;

• COVID-19 – a facilitator or stumbling block to AfCFTA progress;

• Regulatory and policy harmonisation for trade facilitation;

• Inter-relationship between the Single African Air Transport Market (SAATM); the Africa Continental Free Trade Area (AfCFTA) and the protocol of the free movement of people and goods.

United Aviation Solutions and AFRAA launch initiative for “African airlines to provide MRO support to North American airlines”

AFRAA and United Aviation Solutions (UTD) launched the Brown Condor Initiative (BCI) aimed at providing a platform for AFRAA members with Maintenance Repair and Overhaul (MRO) facilities to support their North American counterparts in MRO services and assets. UTD and AFRAA have created a portal that will ensure the reliable delivery of equipment and services to airline customers and channel partners. In the coming weeks, UTD and AFRAA will conduct weekly webinars showcasing the BCI initiative through an engaging and innovative Virtual Reality (VR) presentation.

Mr. Abdérahmane Berthé, AFRAA Secretary General stated: “The BCI will provide aviation stakeholders access to marketleading services to support the development of Africa’s aviation industry. The strengths of AFRAA member airlines are key to the solutions offered for the global crisis in aviation. We have carefully selected AFRAA members that can immediately provide MRO solutions while simultaneously consolidating member Used Serviceable Materials onto one platform.”

“AFRAA is collaborating with innovative thinkers to utilise the downturn in our industry to provide new sustainable opportunities to African airlines.” Mr. Berthé added.

AFRAA’s recovery plan that was developed in 2020 encompasses actions to navigate through COVID-19 that are anchored on 9-pillars, these include: Governments, Regulators, Service providers, Customers, Maintenance, Cost management, Cargo operations, Workforce, Ensuring Business Continuity. The portal addresses actions under pillars on cost management, cargo operations and business continuity.

AFRAA Stages 9th Aviation Stakeholders Convention: Stakeholders align on priorities for an efficient air transport industry recovery

The African Airlines Association (AFRAA) and Ethiopian Airlines held the 9th Aviation Stakeholders’ Convention from 18-19 May 2021. The Convention concluded with an alignment on priorities for the efficient recovery of the air transport industry in Africa.

The event which was held in virtual format, was graced by the Minister of Transport of the Republic of Ethiopia, H.E. Mrs. Dagmawit Moges as the guest of honor and was attended by 538 participants from the air transport industry and fraternity in Africa and across the globe.

Held under the theme: “Building Blocks for the Air Transport Industry Recovery”, the Convention provided an ideal forum for air transport industry stakeholders to dialogue, exchange knowledge and experiences for the sector’s recovery efforts and deliberate on feasible solutions to alleviate challenges in the African travel industry.

Event recommendations and highlights

Travel ecosystem stakeholders at the Convention deliberated on the various on-going and expected actions towards the restart of the industry in the context of the African continent and recommended the following actions for a durable restart and recovery of air travel in Africa:

1. Priority actions for the industry restart

Financial support to airlines as well as the implementation of harmonised and internationally adopted health and travel protocols were singled out as the top priority focus areas for the industry restart.

2. Safe reopening of borders

African States were urged to expedite the vaccine roll-out campaign in Africa, lift prohibitive travel restrictions, adopt globally interoperable digital health pass or certificate and make available universal, accessible and affordable COVID-19 testing facilities to all air travellers.

3. Financial support to airlines

A call was made for greater collaboration and acceleration of the collective efforts among stakeholders with States and financial institutions urged to provide financial support to the travel industry. Airlines on their end were encouraged to improve the sustainability of their operations in order to

enhance their bankability and thus be in a position to receive better support from financial institutions.

4. Sustainable airline operations – actions by airlines

African Airlines were encouraged to be flexible, lean, smart, collaborate and have a clear strategic focus putting in place a future-ready business model.

5. Sustainable airline operations – actions by industry stakeholders

Stakeholders were urged to address the issue of high taxes, fees and charges that impact the sustainability of the air travel industry and support the implementation of the Africa Continental Free Trade Agreement (AfCFTA) and the Single African Air Transport Market (SAATM) to drive business growth in Africa and intra-Africa connectivity.

6. Cargo operations

Operators were urged to treat cargo as core-business and to give it priority in strategy, fleet planning, network development and to be represented at the board-level.

7. Safety

With AfDB support, AFCAC, AFRAA and IATA to continue with joint efforts to prepare African airlines for ISSA or IOSA to further improve Africa safety performance. Additionally, AFRAA airlines with FAA or EASA approved MROs were urged to contribute in the enhancement safety through continuous airworthiness and generate new revenues under the framework of the AFRAA-UTD MRO joint initiative.

8. Technology

Investment in technology that will enhance the passenger experience, drive cost savings and improve operational efficiencies was highlighted as key. Airlines were urged to leverage on smarter retailing to survive in today’s dynamic market and unlock incremental revenue streams.

9. Fuel

A call was made for the industry to adopt competitive and transparent fuel costs in Africa. Stakeholders in the fuel supply chain were urged to work together to adopt best practices for safe, quality jet fuel, especially after such a prolonged period of low level operations.

AFRAA participates in the review of draft external ASA policy guidelines

On 18 May 2021, the AUC convened a meeting of industry stakeholders including AFRAA, to review the draft external policy guidelines and binding clauses for negotiations of air service agreements with non-African states (this draft was earlier send to all member airlines by the Secretariat). From the discourse, it was apparent

that further consultation was required particularly at the States level. The meeting agreed to allow states more time to review the document and submit their comments before another meeting of experts is convened. Airlines that did not provided input to this draft document were encouraged to do so through their respective states.

AFRAA industry Call for Action for safe reopening of borders to foster Saving Lives, Economies, and Livelihoods in the African Continent

AFRAA, as part of the Africa High Level Task Force on the Recovery of the African Air Transport Industry joined African Ministers responsible for Health, ICT, and Transport to make a call to the African States to work towards harmonising preentry and exit requirements for cross-border travel, increase mutual recognition, and cross-border information exchange. The Africa CDC, the lead COVID-19 response organ of the African Union, has gone further to provide a platform to member states to support this undertaking known as Trusted Travel (www.africacdc.org/trusted-travel). The Ministers also called for cross-collaboration among different sectors and stakeholders. The Call to Action comes under the umbrella of Africa Against COVID-19: ‘Saving Lives, Economies, and Livelihoods’ campaign, which recognises the need to define our ‘new normal’ by striking a balance between saving lives, reopening of economies, and revitalising livelihoods within the African continent.

The Call to Action has been jointly developed by a multisector Africa High Level Task Force, comprising of the African Union and other relevant regional and international institutions and partners. It addresses specific elements to safely re-open all borders including intra-regional and international air travel.

JUNE 2021

The Africa High Level Task Force on the Recovery of the African Air Transport Industry was set up to serve as an advisory body for the campaign on African against COVID-19 “Saving Lives, Economies and Livelihoods”. The campaign was endorsed on 20 August 2020 by the Bureau of the Assembly of the African Union (AU) Heads of State and Government with Chairpersons of Regional Economic Communities (RECS) of the African Union. AFRAA is among the stakeholders and partners that form the Task Force. The other members of the Task Force include: AFCAC, ACI Africa, IATA, ICAO, WHO, the Afrochampions Initiative, Africa CDC and the AUC.

The Task Force developed a Call to Action that addresses specific elements to safely re-open all borders including intraregional and international air travel on:

• Travel entry and exit requirements;

• Maintaining safe public health corridor before, during and after travel;

• Compliance to multinational treaties and regulations. The Call to Action was circulated to the respective Ministries and Heads of State of African States and work is underway across different levels to ensure the recommendations are carried out.

AFRAA releases the 2020 Africa air transport report

On 2 June 2021, AFRAA released the 2020 Africa air transport report. The report gives an in-depth analysis of Africa’s air transport industry performance for 2020 covering: financial performance, passenger and cargo traffic evolution, airport ranking, intra Africa connectivity and openness. The

report provided details of the dismal operational and financial performance of the airline industry as a consequence of the COVID-19 pandemic. The report can be accessed through the link https://afraa.org/wp-content/uploads/2021/06/AFRAAAir-Transport-Report-Q1-2021-Updated.pdf

AFRAA SkyConnect leadership dialogues

The June 2021 edition of the AFRAA SkyConnect took place on 2 June 2021. The show hosted Mr. Romain Ekoto, Chief Aviation and Air Transport Officer – Infrastructure, Cities and Urban Development Department at the AfDB who took the stage for a thought-provoking one-on-one dialogue on the role of AfDB in supporting Africa aviation sector.

Participants in the June edition of the SkyConnect dialogues got insights on:

• Role AfDB in supporting Africa aviation sector

• Investment in airlines – government vs private sector

° Limitations to foreign investments

° Market access

° Making air transport in Africa attractive

• Single African Air Transport Market (SAATM)

° Support to AFCAC – safety/capacity building

° Ongoing progress

° Improving connectivity and lowering costs

• Bank’s interventions on the Impact of COVID-19.

AFRAA concludes the 2021 fuel tender programme: Significant cost savings estimated for participating airlines

The Secretariat concluded the AFRAA fuel tender 2021-22 process on 10 June 2021 under the framework of the AFRAA fuel project. The fuel programme, which runs on an annual basis, has achieved a total of USD 55 million cost savings to the participating airlines since its establishment in 2012. The 2021 fuel programme is expected to realise an estimated USD 0.5 million in cost savings cumulatively for the participating airlines for the period 2021-2022.

Fuel is the most significant component of operating costs of flight operations. Fuel costs are significantly higher in Africa compared to the rest of the world. High fuel costs and other expensive charges drive down the competitiveness of African air carriers. As a result, African airlines’ available seat-kilometre costs are much higher than the industry average.

Other focus areas for value addition to airlines by the AFRAA Fuel Committee include:

JULY 2021

July AFRAA SkyConnect dialogues

The July edition of AFRAA SkyConnect show hosted Mr. Ali Tounsi, Secretary General – ACI-Africa for a thoughtprovoking one-on-one dialogue on:

• ACI-Africa’s role in supporting African aviation and especially its role in airports safety, security, infrastructure/capacity development and sustainability;

• The size of African airport and implications for revenue generation;

• Lobbying in close collaboration with industry stakeholders (Airlines, Industry Associations, Fuel Suppliers, Governments and Regulatory Authorities) for the reduction of high taxes charges and fees;

• Addressing unique challenges being faced by African airlines on fuel on a location by location basis;

• Capacity building to participating members in fuel purchase and management through experts on the negotiation and handling of fuel purchases as well as fuel cost management and other areas relating to commercial aviation fuel.

A total of 12 member airlines participated at the 2021 programme, including: Air Bostwana, Air Burkina, ASKY, Astral Aviation, Kenya Airways, LAM Mozambique, Precision Air, RwandAir, South African Airways, TAAG Angola, Camair-co and Congo Airways.

• Competitiveness of airports and airlines expectations;

• State owned versus private airports – ACI-Africa’s views;

• Airports readiness for traffic boom arising from SAATM and AfCFTA implementation;

• Collaboration for success of the industry.

AFRAA Technical Operations & Training Committee meeting

The AFRAA Technical Operations and Training Committee (TOTC) held its second meeting online on Tuesday, 6 July 2021, The meeting reviewed subjects such as cooperation with members’ Training Centers, cost reduction initiatives, regional programmes relating to air navigation services, and safety.

Airline representatives from Engineering and Maintenance, flight and ground operations, and training departments attended the meeting.

With regards to cooperation with member airlines training centers, AFRAA made significant steps in implementing the EXC directive relating to the cooperation with member airlines Training Centers. The Secretariat has signed a Memorandum of Understanding with Ethiopian Aviation Academy, Kenya Airways Pride Center and Royal Air Maroc.

Joint letters to States and to DFIs on financial support to airlines

Following the AFRAA, AASA, IATA and the AUC held on 21 June 2021 to re-evaluate and identify joint actions to take on financial support to the airline industry in view of the dire situation, AFRAA in collaboration with AASA and IATA made the following campaigns:

i. AFRAA, AASA, IATA joint letters to States requesting for urgent financial support to African airlines – July 2021: African airline industry joint association letter to African States to follow up on the African Union Commission’s (AUC) appeals to governments for urgent direct and indirect financial support that will facilitate the revival of aviation economic activities.

ii. AFRAA, AASA, IATA joint letter to Development Financial Institutions (DFIs) on COVID-19 financial support to African airlines – July 2021: African airline industry joint association letter to DFIs to seek urgent consideration in

AUGUST 2021

allocating resources which airlines can draw to sustain their operations and request for guidelines on the preconditions, documentation and/or guarantees that are required from airlines to access the facilities from the DFIs.

AFRAA SkyConnect leadership dialogues

The August edition of the AFRAA SkyConnect Dialogues hosted Ms. Elcia Grandcourt, Director, Regional Department for Africa – UN World Tourism Organization (UNWTO) as the guest for a thought-provoking one-on-one dialogue. The show discussed:

• The role of UNWTO in supporting tourism development in Africa;

• Competitiveness and sustainability of Africa tourism;

• Connectivity and tourism;

• Future of tourism – post-COVID outlook for Africa;

• Collaboration for industry success – How UNWTO is working with other organisations for tourism restart and sustainability.

AFRAA holds virtual workshop user charge fees, charges and taxes in collaboration with IATA, ICAO, ACI and CANSO

In the month of August AFRAA held a joint meeting with IATA, ICAO, ACI and CANSO on airport and air navigation user charges. The aviation virtual workshop which was held on 19 August 2021, gave an overview of ICAO framework for setting user charges, looked at the concept of building blocks in aviation charges and also discussed actions to restore a sustainable economic equilibrium for airports and

SEPTEMBER 2021

African aviation ecosystem. The industry needs to take appropriate actions for the implementation of policies on aeronautical user charges for future success of the aviation industry. The other important event on taxes and charges is the coming AFRAA LAB on High Taxes and Charges scheduled to take place in Q1 2022.

AFRAA September SkyConnect dialogues

Mr. Abdérahmane Berthé, AFRAA Secretary General, took the stage during the September 2021 edition of AFRAA SkyConnect. Mr. Berthé as he shared with stakeholders the laudable projects and programmes being led by African Airlines Association (AFRAA) in the African landscape of the air transport sector.

Highlights of the dialogue:

1. African air transport state of the industry;

2. AFRAA position on vaccination and health protocols for a safe restart;

3. Status updates on financial support for the air transport industry and the impact on African airlines’ competitiveness;

4. AFRAA initiatives for African airlines’ collaboration and consolidation;

5. Milestones on the implementation of the Single African air transport market (SAATM) and the African Continental Free Trade Agreement (AfCFTA);

6. AFRAA’s collaboration with industry organizations for the development of the travel and tourism sectors: UNWTO, ACI Africa, IATA.

AFRAA in collaboration with Lufthansa Consulting and Kenya Airways hold an airlines consolidation workshop

The African Airlines Association (AFRAA), Lufthansa Consulting and Kenya Airways staged a high level workshop on 14 September 2021 on African airlines consolidation to discuss the reasons for few partnerships and limited airline

consolidation, the challenges and benefits of consolidation and measures for action by industry stakeholders to address the situation.

The important workshop brought together over 200 participants comprising airline CEOs, C-level representatives from airports, CAAs and other African air transport decision makers as well as the media.

The forum articulated the following recommendations for action by the industry:

i. Consideration of various models of consolidation including equity partnerships between two airlines or across a group of investments, cooperation between two or more wellmatched airlines, or the formation of a new common airline. The concept of ‘Air Afrique’ remains a valid consideration for Africa;

ii. Implementation of appropriate corporate governance structure is necessary for consolidation. Political interference in the airline management is to be avoided;

iii. Call to Development Finance Institutions (DFIs) to finance the feasibility study of consolidation models;

iv. Call for uniform implementation of harmonised regulations and the establishment of an enabling working relationship between regulators, airlines and Regional Economic Communities (RECs);

v. Enhancement of cooperation among African airlines (alliance of airlines, pooling resources, code sharing and interlining);

vi. Call for support and commitment from Governments for airline consolidation in Africa;

vii. Urge airlines to carry out careful evaluation of potential consolidation/partnerships based on factual data;

viii. Exploration of cargo opportunities for air cargo consolidation;

ix. Call for government and private sector collaboration to achieve concrete steps in airline consolidation;

x. ‘Walk the Talk’ – translate ongoing discussions into action in the interest of delivering accelerated benefits to the aviation ecosystem.

AFRAA and UNWTO sign MoU to cooperate to restart of African Tourism and Travel

On 21 September 2021 UNWTO has signed a memorandum of understanding (MoU) with the African Airlines Association (AFRAA) to work more closely together and strengthen the relationship between the aviation and tourism sectors. The MoU was signed by Abdérahmane Berthé, AFRAA’s Secretary-General and UNWTO Secretary-General Zurab Pololikashvilil. Under the terms of the agreement, both parties will consult each other on matters and activities of mutual interest to develop greater connectivity and advance seamless travel across Africa. The two parties will also work together to encourage greater cooperation and dialogue between the transportation and tourism sectors within the continent. Secretary-General Pololikashvili said: “Coordination and cooperation are essential for the safe restart of tourism

across Africa. Closer collaboration between our sector and aviation will also help African tourism grow in the years ahead, driving economic development and providing opportunities for millions of people throughout the continent.”

AFRAA Secretary General, Mr. Abdérahmane Berthé stated: “Aviation and tourism are interrelated and interdependent. By signing this MoU, AFRAA and UNWTO will augment the coherence between the two sectors as well as harmonise the respective regulatory frameworks and sectorial policies.”

In the more immediate term, the new MoU is aimed at helping mitigate the impacts of the pandemic on African aviation and restarting international travel. Looking further ahead, the agreement will also help grow the overall benefits of tourism and air transport within both national and regional economies.

AFRAA stages a SAATM capacity building workshop in collaboration with AUC and AFCAC

The Capacity Building Workshop on the Institutional and Regulatory Instruments of the Yamoussoukro Decision was jointly organised by AU, AFCAC and AFRAA and hosted by AFRAA took place on 29-30 September 2021 in a virtual format.

The workshop was organised following the adoption of the following Institutional and Regulatory Instruments of the Yamoussoukro Decision (YD) by the 30th Ordinary Summit of the African Union Assembly of Heads of States and Government summit held in Addis Ababa, Ethiopia in January 2018:

• Powers and Functions of the Executing Agency (EA);

• Competition rules and;

• Consumer Protection Regulations.

This workshop is the third in a series of events planned by the AU and AFCAC to sensitize various stakeholder groups and the RECs on the institutional and regulatory texts. The earlier two were held in February and August 2019 in Addis Ababa and Niamey respectively.

At the end of the workshop delegates were:

• Taken through the various institutional and regulatory text to enhance their understanding and appreciation;

• African Airlines are now equipped with knowledge on how to apply the Instruments in their operations;

• Backed by the knowledge acquired airlines are encouraged to join in the advocacy to gets more States to Commit to the Solemn Commitment of SAATM;

• Airlines also shared their experiences Competition and Consumer Protection regulations implementation and highlighted areas that need improvement.

AFRAA in collaboration with Sabre stage workshop on partnering for enhanced data strategy

The workshop gave expert insights and case-study experience on how airlines can enhance their data strategy so as to cost-effectively access the right information at the right

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time and in the right places. The aviation sector is collectively suffering from the COVID-19 pandemic. Digital transformation will be an essential driver for recovery of the industry.

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OCTOBER 2021

AFRAA SkyConnect leadership dialogues

The October 2021 edition of AFRAA SkyConnect hosted Dr. Mohammed Abdulaziz, Head, Division of Surveillance and Disease Intelligence – Africa Centres for Disease Control and Prevention (Africa CDC).

Highlights of the dialogue:

• The role of Africa CDC in supporting Africa on disease control and prevention;

• COVID-19 pandemic and response by African States on regulations/protocols and impact particularly on aviation;

• Updates on the Africa against COVID-19: Saving Lives, Economies and Livelihoods campaign;

• On-going initiatives by the Multi-Sectoral Task Force on Trusted Travel and Reopening of Borders

AFRAA – Lufthansa Consulting workshop on customer seervice

AFRAA in partnership with LH Consulting held a virtual workshop on the theme: “Bringing Back the Customer: Customer Experience and Trends” on 7 October 2021. The workshop gave expert insights and case-study experience on how airlines can enhance their customer experience strategy so as to effectively bring back the customer. The aviation sector is collectively suffering from the COVID-19 pandemic. An effective customer experience strategy and digitalisation will be essential drivers for airline recovery.

The Workshop:

i. Provided insights into the Lufthansa Consulting trend radar and recent customer experience trend study 2021;

ii. Shared expert opinion on the application of international market trends on the African market through interactive discussions on commercial and digital passenger use cases;

iii. Discussed current traveller needs and evaluate improvements on commercial performance.

AFRAA in collaboration with Collins Aerospace stage conference on gender diversity and the development of skilled aviation professionals vital for a sustainable Air Transport Industry

Air Transport is the backbone of many economies across Africa and is critical for the integration of the African continent. One of aviation’s greatest potential markets is Africa. Africa has a young and rapidly urbanizing population of over 1.3 billion and aviation is the best, and sometimes the only, option for efficiently connecting this huge market.

As stakeholders continue to put in place measures to redefine and restart the travel industry, the attainment of gender diversity and the development of skilled aviation professionals remain vital for sustainability. The African Airlines Association (AFRAA) in partnership with Collins Aerospace staged a 2-day conference on 19-20 October to facilitate dialogue, share information, experiences and best practices to attain gender diversity and youth development in aviation.

The conference was held in virtual format under the theme: “Women and Youth Development in Aviation for a Sustainable Future”. The conference provided an ideal forum for air transport industry stakeholders to take stock of the trends, deliberate on feasible solutions to bridge the gender gap and develop young aviation professionals for the sustainability of the air transport sector.

The conference presentations revealed that women numbers are still low in STEM-related careers and women are underrepresented in leadership positions in aviation. In the world’s top 100 airlines, just 3% of airline CEOs and COOs and 8% of CFOs are women according to a study done by IATA. The gender diversity in aviation is a work in progress, with slow improvements witnessed in the last decade, a lot more needs to be done.

I. Airline Board Director Members Workshop

The Secretariat organised a workshop for Airlines Board Members on 20 October 2021. The workshop was aimed to introduce the aviation industry to members. The following subjects were presented:

i. About AFRAA

ii. Overview of the aviation industry

iii. State of the airline industry

iv. Airline business models

v. Types of airlines

vi. Airline cooperation models

vii. Network & fleet planning

viii. AU Vision 2063 flagship projects related to aviation and potential benefits.

The important workshop brought together 36 participants comprising airline Board of Director members, CEOs, C-level executives.

AFRAA Secretary General receives Leadership Changemaker Award

The African Airlines Association (AFRAA) Secretary General, AFRAA, Mr. Abdérahmane Berthé, received the Leadership Changemaker Award recognition by Aviators Africa on 27 October 2021.

The Award was presented at the Aviators Africa Tower Award ceremony that took place at the 3rd Aviation Leadership CEOs Forum on 27 October 2021. The event was attended by aviation executives and industry leaders across Africa and beyond with the objective of changing the narrative around decision and policy making in Africa.

Speaking at the award ceremony, Mr. Berthé said: “Leadership is most successful when it relies on a good team. I dedicate this Award to the Executive Committee of AFRAA, the

members of the Association and the AFRAA Secretariat team, in appreciation of their valuable support to my efforts since at the helm of AFRAA which have culminated to being ranked as a corporate leader in the African aviation industry.”

“This Award further emphasizes AFRAA’s leadership to represent and serve African airlines as we work closely with our members, partners, industry organizations, governments and stakeholders,” he added.

The Changemaker Award category was presented to individuals who have contributed immensely to the growth of African Aviation. This is in a bid to foster new thinking and promote healthy competition, originality, and creativity, for sustainable growth in the sector.

AFRAA inks MoU with ALTA for mutual benefit of airlines in Africa, Latin America and the Caribbean region

On 29 October 2021, AFRAA signed a Memorandum of Understanding (MoU) with the Latin American and Caribbean Air Transport Association (ALTA) to support the socio-economic integration, prosperity and sustainable development of civil aviation in the regions represented by the two Associations.

The MoU was signed by Abdérahmane Berthé, AFRAA’s Secretary General and José Ricardo Botelho, ALTA’s Executive

NOVEMBER 2021

Director & CEO at the 2021 ALTA Airline Leaders Forum in Bogota, Colombia.

Under the framework of the collaboration, AFRAA and ALTA will work closely on actions to achieve common objectives for the mutual benefit of their membership on advocacy at global level, airline cost-saving best practices, airline financing, environmental sustainability, liberalisation and connectivity, data exchange, training and addressing the subject of high taxes, charges and fees.

AFRAA SkyConnect leadership dialogues hosts Afreximbank

The November 2021 edition of AFRAA SkyConnect hosted Ms. Oluranti Doherty – Afreximbank Director, Export Development. Afreximbank shared with stakeholders the laudable initiatives being led by the bank to support Aviation in Africa, the challenges and opportunities in aviation financing and the bank’s future plans for the development of the air transport sector in Africa.

Highlights of the dialogue:

• Afreximbank’s support to combat COVID-19 pandemic: the successes and challenges;

• Afreximbank’s role in the development of Africa:, especially investments in infrastructure, capacity development and trade/tourism facilitation;

• Challenges in aviation sector financing and recommendations to enhance the attractiveness of the sector to financiers;

• Afreximbank’s support on SAATM and AfCFTA.

AFRAA launches spare part pooling portal

AFRAA launched the spare parts pooling portal on 25 November 2021. Member airlines will be required to comply and participate in the pool activities at various pool stations by signing the pool Agreement. Upon Signing the AFRAA Line Maintenance Agreement AFRAA members will qualify to exercise membership as user or provider of pool items.

There will be no Membership fees to join the pool; operators will only pay pool station participation fees and pool item access fees as users of pool items. Those who participate as pool items’ providers will receive remittance corresponding access fees paid by other users.

AFRAA’s 53rd AGA sets roadmap for the transformation and the economic development of air transport in Africa

Air transport leaders and decision makers set a roadmap for transformation and the economic development of air transport in Africa at the 53rd AFRAA Annual General Assembly & Summit that has held from 16-17 November 2021. The event was held under the patronage of the Government of Angola under the theme: “Flightpath to Africa’s resilient travel ecosystem.”

The AFRAA AGA is the premier gathering of African airline

CEOs and high level aviation executives in Africa and across the globe. This year’s event was hosted by TAAG Angola Airlines in virtual format. The Assembly brought together over 400 delegates from 51 nationalities across the globe comprising of decision-makers and aviation leaders. International and regional air transport associations including the African union, IATA, ICAO, AFCAC, ALTA were also represented at the event.

Industry resolutions

The Assembly concluded with the adoption of three (3) industry resolutions to advance the cause of African aviation:

i. Resolution on safe reopening of borders

Recognising that safe reopening of borders in a harmonised manner is critical for the efficient restart of African aviation, the Assembly urged African governments to remove border restrictions and open their markets to restart the industry with support from Industry Restart Plan Standards and guidance documentation. The Assembly further called upon African governments to accelerate the rapid roll out of vaccines across the continent and embrace the use of digital technology health platforms to facilitate the restart of economies and air transport.

ii. Resolution on financial support to African airlines

Recognising the importance of financial support for the recovery of the air transport industry, the Assembly called upon African governments to extend the much-needed financial support and relief to African airlines and the African aviation industry at large.

iii. Resolution on Lab concept approach for attainment of sustainability of African airlines

Recognising the importance of addressing the sustainability and competitiveness of Africa’s air transport, the Assembly called for a laboratory convening all relevant stakeholders as a transformation opportunity for the economic development of air transport in Africa. AFRAA Secretariat in coordination with the African Union Commission (AUC), The African Civil Aviation Commission (AFCAC), and the African Aviation Industry Group (AAIG) shall convene the LAB by the end of March 2022.

The AAIG defines actions for a risk-based approach to restart and secure Industry viability of African aviation

18 November 2021

The African Aviation Industry Group (AAIG) held its annual Aeropolitical Forum on 18 November 2021 in virtual format following the conclusion of the AFRAA 53rd Annual General Assembly. Staged under the theme, “African Aviation Restart and Recovery” industry stakeholders at the forum deliberated on the industry priorities and agreed on the set of actions for implementation during the year 2022 and beyond.

The main focus areas of discussion were on a risk-based approach for reopening of borders and restart, the attainment

Highlight of takeaways and recommendations

1. Safe reopening of borders

i. Lifting of prohibitive travel restrictions

Harmonisation of health border protocols

ii. Digitisation and data driven approach for health protocols

DECEMBER 2021

of viability of the African air transport industry and the aeropolitical developments. The Forum articulated a number of recommendations that the AAIG shall take on-board in the 2022 plan of activities for action.

The Forum was attended by over 150 participants comprising representatives of African aviation institutions, Development agencies, African airlines, Civil Aviation Authorities, Airport Operators, Airline Associations, government entities, Aircraft manufacturers and aviation solutions and service providers.

iii. Vaccination roll-out

2. Financial support to the travel sector

3. Economic viability and sustainability of the air transport sector in Africa

December AFRAA SkyConnect campaign content

The December 2021 edition of AFRAA SkyConnect hosted Mr. Aaron Munetsi, Chief Executive Officer – Airline Association of Southern Africa (AASA). AASA CEO shared with stakeholders the industry recovery process in Southern Africa region, collaboration and competitiveness of airlines

in the southern African region and AASA’s perspectives on consolidating the gains Africa has made in aviation and how to accelerate the pace of rolling out key initiatives to spur continental development and integration.

Highlights of the dialogue:

• State of the airline industry in the Southern Africa aviation market;

• AASA’s vision in improving the lot of the Southern African region and Africa at large;

AFRAA consultancy services

Through AFRAA consulting unit AFRAA is providing our members and with access to market-leading strategic services and training, giving them the means to improve organisational resilience and respond even more effectively to global market opportunities.

Expertise: AFRAA Consulting has a wide scope of in-depth airline industry experience and expertise to African airlines geared to attain sustainable airline operations in Africa, including:

• Airline restructuring

• Technical and operations

• Training

• Safety

• Finance & commercial

Training Courses

• AASA’s perspectives on improving the cost competitiveness of the airline industry;

• AASA’s plan of activities for 2022;

• Recommendations for change in Africa’s aviation for 2022.

AFRAA is providing virtual courses to African airlines and aviation stakeholders to support a smooth resumption process for the air transport industry. These courses are being offered at attractive rates and flexible format to suit the industry needs.

Safety and security courses

• Safety management system

• Human factors in aviation

• Dangerous goods regulations

• Dangerous goods regulations refresher

We are currently engaged on two projects in Africa

One of these projects entails consultancy services to the Cameroon government to support the development of the transport sector in the country and the other is on the AfDBfunded project to sponsorAir.

AFRAA consulting unit has undertaken the following projects:

i. In July 2021, AFRAA-ALG completed the project of “Elaboration of the strategic plan for the development of air transport in Cameroon to 2035”;

ii. AFRAA-ALG has been selected for the project of “Development of an aviation policy for Kenya and review of the proposed medium-term investment requirements for enhancing passenger terminal capacity at the Jomo Kenyatta International Airport”;

iii. AFRAA is engaged in the AfDB-funded SAATM Airlines Assistance Project.

• Quality management systems

• Airline documentation management and control

• Advanced safety management systems

• Security management systems

• Safety risk management

• ISAGO awareness

• Aircraft accident and incident investigation

• ISAGO for Ground Service Providers

• IOSA/ISSA airline auditor

Commercial courses

• Business continuity and succession planning

• Financial management (Finance for non-finance managers/ budgeting)

• Strategic planning and leadership

The training programme is available on AFRAA website. We invite members, airlines and stakeholders to contact us for your specific training needs via email: training@afraa.org

STATE OF THE INDUSTRY 2021

STATE OF THE INDUSTRY 2021

STATE OF THE INDUSTRY 2021

STATE OF THE INDUSTRY 2021

THE COVID19 VACCINATION (OCT 2021)

THE COVID19 VACCINATION (OCT 2021)

THE COVID19 PANDEMIC (OCT 2021)

THE COVID19 VACCINATION (OCT 2021)

OF THE INDUSTRY 2021

OF THE INDUSTRY 2021

STATE OF THE INDUSTRY 2021

THE COVID19 PANDEMIC (OCT 2021)

THE COVID19 PANDEMIC (OCT 2021)

THE COVID19 PANDEMIC (OCT 2021)

Source : ourworldindata.com / CDC AFRICA

STATE OF THE INDUSTRY 2021

STATE OF THE INDUSTRY 2021

STATE OF THE INDUSTRY 2021

Source : ourworldindata.com / CDC AFRICA

COVID19 IMPACT ON AFRICAN ECONOMY

COVID19 IMPACT ON AFRICAN ECONOMY

COVID19 IMPACT ON AFRICAN ECONOMY

ü GDP of Africa contracted by 2.1% in 2020, the first recession in the continent over the last 50 years.

ü GDP of Africa contracted by 2.1% in 2020, the first recession in the continent over the last 50 years.

THE COVID19 PANDEMIC (OCT 2021)

STATE OF THE INDUSTRY 2021

COVID19 IMPACT ON AFRICAN ECONOMY

ü The continental economy is expected to resume and grow by 3.4% in 2021, supported by a resumption of tourism, a rebound in commodity prices and the gradual lifting of restrictions related to the pandemic.

ü The continental economy is expected to resume and grow by 3.4% in 2021, supported by a resumption of tourism, a rebound in commodity prices and the gradual lifting of restrictions related to the pandemic.

Source : AfDB

Source : AfDB

Source : AfDB

ü GDP of Africa contracted by 2.1% in 2020, the first recession in the continent over the last 50 years.

ü The continental economy is expected to resume and grow by 3.4% in 2021, supported by a resumption of tourism, a rebound in commodity prices and the gradual lifting of restrictions related to the pandemic.

STATE OF THE INDUSTRY 2021

COVID19 IMPACT ON AFRICAN AIRLINES

Source : AfDB

Source : AFRAA

STATE OF THE INDUSTRY 2021

STATE OF THE INDUSTRY 2021

STATE OF THE INDUSTRY 2021

THE COVID19 PANDEMIC (OCT 2021)

COVID19 IMPACT ON AFRICAN AIRLINES

COVID19 IMPACT ON AFRICAN AIRLINES

International flights resumption

ü Compared to February 2020 , African airlines reopened 81.3% of their international routes in October 2021.

ü Compared to February 2020 , African airlines reopened 81.3% of their international routes in October 2021.

Source : AFRAA

Source : AFRAA

Future outlook 2022 and Beyond

Future outlook 2022 and Beyond

AFRAA PRIORITIES FOR 2022

AFRAA PRIORITIES FOR 2022

1. Safe reopening of borders

1. Safe reopening of borders

2. Financial relief

2. Financial relief

3. Airlines sustainability

3. Airlines sustainability

4. AFRAA 5-Year Strategic Plan

4. AFRAA 5-Year Strategic Plan

5. AFRAA Consultancy Services

5. AFRAA Consultancy Services

Future outlook 2021 and Beyond

AFRAA STRATEGIC OBJECTIVES

Support safe, secure and reliable air transport in Africa

Sustainable air transport

5 strategic objectives

Enhance the visibility,